Stewart Information Services (NYSE:STC) and ProAssurance (NYSE:PRA) Critical Comparison

Stewart Information Services (NYSE:STC) and ProAssurance (NYSE:PRA) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, earnings, institutional ownership, analyst recommendations, valuation, profitability and risk.

Earnings & Valuation

This table compares Stewart Information Services and ProAssurance”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stewart Information Services	$2.92 billion	0.58	$115.54 million	$4.04	14.92
ProAssurance	$1.10 billion	1.15	$50.92 million	$0.98	24.96

Stewart Information Services has higher revenue and earnings than ProAssurance. Stewart Information Services is trading at a lower price-to-earnings ratio than ProAssurance, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Stewart Information Services has a beta of 1.01, suggesting that its share price is 1% more volatile than the S&P 500. Comparatively, ProAssurance has a beta of 0.04, suggesting that its share price is 96% less volatile than the S&P 500.

Profitability

This table compares Stewart Information Services and ProAssurance’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stewart Information Services	3.95%	9.32%	4.82%
ProAssurance	4.64%	6.50%	1.52%

Analyst Ratings

This is a breakdown of recent ratings and price targets for Stewart Information Services and ProAssurance, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stewart Information Services	0	0	4	0	3.00
ProAssurance	1	4	0	1	2.17

Stewart Information Services currently has a consensus price target of $81.33, indicating a potential upside of 34.97%. ProAssurance has a consensus price target of $25.00, indicating a potential upside of 2.19%. Given Stewart Information Services’ stronger consensus rating and higher possible upside, equities research analysts clearly believe Stewart Information Services is more favorable than ProAssurance.

Institutional and Insider Ownership

96.9% of Stewart Information Services shares are owned by institutional investors. Comparatively, 85.6% of ProAssurance shares are owned by institutional investors. 1.5% of Stewart Information Services shares are owned by company insiders. Comparatively, 1.2% of ProAssurance shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

Stewart Information Services beats ProAssurance on 11 of the 15 factors compared between the two stocks.

About Stewart Information Services

Stewart Information Services Corporation, through its subsidiaries, provides title insurance and real estate transaction related services in the United States and internationally. The company involves in searching, examining, closing, and insuring the condition of the title to real property. It also offers home and personal insurance services; services for tax-deferred exchanges; and digital customer engagement platform services. It also provides appraisal management, online notarization and closing, credit and real estate information, and search and valuation services. The company serves homebuyers and sellers, residential and commercial real estate professionals, mortgage lenders and servicers, title agencies and real estate attorneys, and home builders through direct operations, network of independent agencies, and other businesses. The company was founded in 1893 and is headquartered in Houston, Texas.

About ProAssurance

ProAssurance Corporation, through its subsidiaries, provides property and casualty insurance, and reinsurance products in the United States. The company operates through Specialty Property and Casualty, Workers’ Compensation Insurance, and Segregated Portfolio Cell Reinsurance segments. It offers professional liability insurance to healthcare providers and institutions, and attorneys and their firms; medical technology liability insurance to medical technology and life sciences companies; and custom alternative risk solutions, including assumed reinsurance, loss portfolio transfers, and captive cell programs for healthcare professional liability insureds. The company also provides workers’ compensation insurance products, such as guaranteed cost policies, policyholder dividend policies, retrospectively rated policies, and deductible policies, as well as alternative market solutions that include program design, fronting, claims administration, risk management, SPC rental, asset management, and SPC management services for individual companies, agencies, groups, and associations. The company also participates in Syndicate 1729 at Lloyd’s of London for underwriting. It markets its products through independent agencies and brokers, as well as an internal business development team. The company was founded in 1976 and is headquartered in Birmingham, Alabama.