MBIA (NYSE: MBI) and Loews Corporation (NYSE:L) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, dividends, earnings, risk, analyst recommendations, valuation and profitability.
Loews Corporation pays an annual dividend of $0.25 per share and has a dividend yield of 0.5%. MBIA does not pay a dividend. Loews Corporation pays out 7.5% of its earnings in the form of a dividend.
Institutional and Insider Ownership
91.9% of MBIA shares are held by institutional investors. Comparatively, 58.8% of Loews Corporation shares are held by institutional investors. 4.1% of MBIA shares are held by insiders. Comparatively, 11.8% of Loews Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Valuation and Earnings
This table compares MBIA and Loews Corporation’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|MBIA||$237.00 million||5.49||-$1.52 billion||($12.11)||-0.85|
|Loews Corporation||$13.28 billion||1.20||$3.33 billion||$3.32||14.29|
Loews Corporation has higher revenue and earnings than MBIA. MBIA is trading at a lower price-to-earnings ratio than Loews Corporation, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings and recommmendations for MBIA and Loews Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
MBIA currently has a consensus target price of $14.50, suggesting a potential upside of 40.23%. Loews Corporation has a consensus target price of $39.00, suggesting a potential downside of 17.77%. Given MBIA’s stronger consensus rating and higher probable upside, equities analysts clearly believe MBIA is more favorable than Loews Corporation.
This table compares MBIA and Loews Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk & Volatility
MBIA has a beta of 2.48, suggesting that its stock price is 148% more volatile than the S&P 500. Comparatively, Loews Corporation has a beta of 0.71, suggesting that its stock price is 29% less volatile than the S&P 500.
Loews Corporation beats MBIA on 8 of the 15 factors compared between the two stocks.
MBIA Company Profile
MBIA Inc. is a holding company. The Company, through its subsidiaries, is engaged in the financial guarantee insurance businesses in the industry. The Company manages its business within three segments: United States (U.S.) public finance insurance; corporate, and international and structured finance insurance. The U.S. public finance insurance business is primarily operated through National Public Finance Guarantee Corporation. The corporate segment consists of general corporate activities, including providing general support services, including management, legal, accounting, treasury, information technology, and insurance portfolio surveillance, to other operating businesses, and asset and capital management. The international and structured finance insurance business is primarily operated through MBIA Insurance Corporation and its subsidiaries.
Loews Corporation Company Profile
Loews Corporation is a holding company. The Company, through its subsidiaries, is engaged in commercial property and casualty insurance; operation of offshore oil and gas drilling rigs; transportation and storage of natural gas and natural gas liquids, and operation of a chain of hotels. The Company has five segments consisted of its four individual operating subsidiaries, CNA Financial Corporation (CNA), Diamond Offshore Drilling, Inc. (Diamond Offshore), Boardwalk Pipeline Partners, LP (Boardwalk Pipeline) and Loews Hotels Holding Corporation (Loews Hotels), and the Corporate segment. CNA’s insurance products include commercial property and casualty coverages, including surety. CNA’s services include risk management, information services, warranty and claims administration. CNA’s core business, commercial property and casualty insurance operations include Specialty, Commercial and International lines of business.
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