AON (NYSE: AON) and Crawford & Company Class B (NYSE:CRD.B) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, earnings, risk, valuation and institutional ownership.

Insider and Institutional Ownership

84.8% of AON shares are held by institutional investors. Comparatively, 15.3% of Crawford & Company Class B shares are held by institutional investors. 0.4% of AON shares are held by insiders. Comparatively, 51.0% of Crawford & Company Class B shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

AON pays an annual dividend of $1.60 per share and has a dividend yield of 1.1%. Crawford & Company Class B pays an annual dividend of $0.20 per share and has a dividend yield of 2.5%. AON pays out 24.5% of its earnings in the form of a dividend. Crawford & Company Class B pays out 23.0% 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. AON has raised its dividend for 6 consecutive years. Crawford & Company Class B is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility & Risk

AON has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500. Comparatively, Crawford & Company Class B has a beta of 1.88, indicating that its stock price is 88% more volatile than the S&P 500.

Profitability

This table compares AON and Crawford & Company Class B’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AON 14.28% 39.65% 7.72%
Crawford & Company Class B 2.43% 27.97% 6.52%

Valuation & Earnings

This table compares AON and Crawford & Company Class B’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AON $10.00 billion 3.47 $1.23 billion $6.52 21.76
Crawford & Company Class B $1.16 billion 0.37 $27.66 million $0.87 9.06

AON has higher revenue and earnings than Crawford & Company Class B. Crawford & Company Class B is trading at a lower price-to-earnings ratio than AON, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations for AON and Crawford & Company Class B, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AON 1 9 4 0 2.21
Crawford & Company Class B 0 0 1 0 3.00

AON currently has a consensus price target of $146.00, suggesting a potential upside of 2.91%. Given AON’s higher probable upside, equities research analysts plainly believe AON is more favorable than Crawford & Company Class B.

Summary

AON beats Crawford & Company Class B on 12 of the 17 factors compared between the two stocks.

AON Company Profile

Aon plc provides risk management services, insurance and reinsurance brokerage, and human resource consulting and outsourcing services worldwide. The company operates through two segments, Risk Solutions and HR Solutions. The Risk Solutions segment offers retail brokerage services, including affinity products, managing general underwriting, placement, captive management services, and data and analytics; risk management solutions for property liability, general liability, professional liability, directors' and officers' liability, transaction liability, cyber liability, workers' compensation, and various healthcare products; and health and benefits consulting services comprising structuring, funding, and administering employee benefit programs. This segment also provides advisory services to technology, financial services, agribusiness, aviation, construction, health care, energy, and other industries. In addition, this segment offers reinsurance brokerage services for treaty and facultative reinsurance, as well as specialty lines, such as professional liability, workers' compensation, accident, life, and health; actuarial, enterprise risk management, catastrophe management, and rating agency advisory services; and capital management transaction and advisory services for insurance and reinsurance clients. The HR Solutions segment offers human capital services in the areas of retirement, compensation, strategic human capital, investment consulting, benefits administration, exchanges, and human resource business process outsourcing. It provides products and services primarily under the Aon Hewitt brand. Aon plc was founded in 1919 and is headquartered in London, the United Kingdom.

Crawford & Company Class B Company Profile

Crawford & Company (Crawford) is an independent provider of claims management solutions to insurance and self-insured entities. The Company’s Crawford Solution offers claims services, business process outsourcing and consulting services for various product lines, including property and casualty claims management; workers’ compensation claims and medical management, and legal settlement administration. Crawford conducts its operations through four segments: U.S. Services, which primarily serves the property and casualty insurance company markets in the United States; International, which serves the property and casualty insurance company, and self-insurance markets outside the United States; Broadspire, which serves the self-insurance marketplace, primarily in the United States, and Garden City Group, which serves the class action, regulatory, mass tort, bankruptcy and other legal settlement markets, primarily in the United States.

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