Comparing Horace Mann Educators (HMN) & Hanover Insurance Group (THG)
Horace Mann Educators (NYSE: HMN) and Hanover Insurance Group (NYSE:THG) are both financials companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, earnings, analyst recommendations, risk, institutional ownership and dividends.
Horace Mann Educators pays an annual dividend of $1.10 per share and has a dividend yield of 2.8%. Hanover Insurance Group pays an annual dividend of $2.16 per share and has a dividend yield of 1.9%. Horace Mann Educators pays out 71.4% of its earnings in the form of a dividend. Hanover Insurance Group pays out 49.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Horace Mann Educators has increased its dividend for 9 consecutive years and Hanover Insurance Group has increased its dividend for 6 consecutive years. Horace Mann Educators is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares Horace Mann Educators and Hanover Insurance Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Horace Mann Educators||5.56%||4.94%||0.61%|
|Hanover Insurance Group||3.59%||6.88%||1.36%|
Earnings & Valuation
This table compares Horace Mann Educators and Hanover Insurance Group’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Horace Mann Educators||$1.13 billion||1.40||$83.76 million||$1.54||25.26|
|Hanover Insurance Group||$5.18 billion||0.92||$186.20 million||$4.34||25.79|
Hanover Insurance Group has higher revenue and earnings than Horace Mann Educators. Horace Mann Educators is trading at a lower price-to-earnings ratio than Hanover Insurance Group, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
98.3% of Horace Mann Educators shares are owned by institutional investors. Comparatively, 83.8% of Hanover Insurance Group shares are owned by institutional investors. 2.4% of Horace Mann Educators shares are owned by insiders. Comparatively, 1.1% of Hanover Insurance Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Volatility & Risk
Horace Mann Educators has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500. Comparatively, Hanover Insurance Group has a beta of 1.11, indicating that its stock price is 11% more volatile than the S&P 500.
This is a summary of current recommendations and price targets for Horace Mann Educators and Hanover Insurance Group, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Horace Mann Educators||0||1||0||0||2.00|
|Hanover Insurance Group||0||1||0||0||2.00|
Horace Mann Educators currently has a consensus target price of $37.00, indicating a potential downside of 4.88%. Hanover Insurance Group has a consensus target price of $91.00, indicating a potential downside of 18.69%. Given Horace Mann Educators’ higher probable upside, research analysts clearly believe Horace Mann Educators is more favorable than Hanover Insurance Group.
Hanover Insurance Group beats Horace Mann Educators on 8 of the 15 factors compared between the two stocks.
About Horace Mann Educators
Horace Mann Educators Corporation (HMEC) is an insurance holding company. Through its subsidiaries, HMEC markets and underwrites personal lines of property and casualty (primarily personal lines automobile and homeowners) insurance, retirement annuities (primarily tax-qualified products) and life insurance in the United States. The Company’s operating segments include Property and Casualty segment, comprising primarily personal lines automobile and homeowners products; Retirement segment, comprising primarily tax-qualified fixed and variable annuities; Life segment life insurance, and Corporate and Other. It markets and services its products through a sales force of full-time agents supported by its Customer Contact Center. These agents sell HMEC’s products and limited additional third-party vendor products. As of December 31, 2016, its property and casualty subsidiaries and its life insurance subsidiary were licensed to write business in over 48 states and the District of Columbia.
About Hanover Insurance Group
The Hanover Insurance Group, Inc. is a holding company. The Company is engaged in providing property and casualty insurance products and services. The Company has four segments: Commercial Lines, Personal Lines, Chaucer and Other. It markets its domestic products and services through independent agents and brokers in the United States, and conducts business internationally through a subsidiary, Chaucer Holdings Limited, which operates through the Society and Corporation of Lloyd’s (Lloyd’s). Its Commercial Lines product suite provides agents and customers with products designed for small, middle and specialized markets. Its Personal Lines coverages include other personal lines, which consist of umbrella and fire, among others. The Chaucer segment consists of international business written through Lloyd’s, including marine and aviation, and property. The Other segment consists of Opus Investment Management, Inc. (Opus), which provides investment advisory services to affiliates.
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