Reviewing Goosehead Insurance (NASDAQ:GSHD) and Sompo (OTCMKTS:SMPNY)

Sompo (OTCMKTS:SMPNY) and Goosehead Insurance (NASDAQ:GSHD) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, analyst recommendations, risk, dividends and valuation.

Dividends

Sompo pays an annual dividend of $0.28 per share and has a dividend yield of 1.5%. Goosehead Insurance pays an annual dividend of $4.60 per share and has a dividend yield of 10.4%. Sompo pays out 13.7% of its earnings in the form of a dividend. Goosehead Insurance pays out 442.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares Sompo and Goosehead Insurance”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sompo	$35.81 billion	0.96	$2.79 billion	$2.05	9.01
Goosehead Insurance	$365.30 million	4.42	$27.83 million	$1.04	42.44

Sompo has higher revenue and earnings than Goosehead Insurance. Sompo is trading at a lower price-to-earnings ratio than Goosehead Insurance, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Sompo and Goosehead Insurance’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sompo	10.62%	13.26%	3.54%
Goosehead Insurance	7.62%	-21.31%	7.79%

Volatility & Risk

Sompo has a beta of 0.38, meaning that its share price is 62% less volatile than the S&P 500. Comparatively, Goosehead Insurance has a beta of 1.57, meaning that its share price is 57% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Sompo and Goosehead Insurance, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sompo	0	0	0	0	0.00
Goosehead Insurance	0	5	7	0	2.58

Goosehead Insurance has a consensus target price of $80.78, suggesting a potential upside of 83.00%. Given Goosehead Insurance’s stronger consensus rating and higher possible upside, analysts plainly believe Goosehead Insurance is more favorable than Sompo.

Summary

Goosehead Insurance beats Sompo on 8 of the 14 factors compared between the two stocks.

About Sompo

Sompo Holdings, Inc. provides property and casualty (P&C) insurance services in Japan and internationally. The company operates through Domestic P&C Insurance Business, Overseas Insurance Business, Domestic Life Insurance Business, and Nursing Care & Seniors Business segments. It offers various P&C insurance products, including automobile, fire, personal accident, and marine, as well as security, risk management, assistance, and warranty services; and life insurance products. The company also provides nursing care and seniors services; and customer security, health, and wellbeing support services. In addition, it offers asset management services; home remodeling services; and health support services comprising health guidance and employee assistance programs. The company was formerly known as Sompo Japan Nipponkoa Holdings, Inc. and changed its name to Sompo Holdings, Inc. in October 2016. The company was incorporated in 2010 and is headquartered in Tokyo, Japan.

About Goosehead Insurance

Goosehead Insurance, Inc. operates as a holding company for Goosehead Financial, LLC that engages in the provision of personal lines insurance agency services in the United States. The company offers homeowner’s, automotive, dwelling property, flood, wind, earthquake, excess liability or umbrella, motorcycle, recreational vehicle, general liability, property, and life insurance products and services. As of December 31, 2023, it operated 1,415 franchise locations. The company was founded in 2003 and is headquartered in Westlake, Texas.