National Interstate (NATL) versus Markel Corporation (MKL) Financial Review

National Interstate (NASDAQ: NATL) and Markel Corporation (NYSE:MKL) are both financials companies, but which is the better investment? We will contrast the two companies based on the strength of their risk, earnings, analyst recommendations, institutional ownership, valuation, dividends and profitability.

Volatility & Risk

National Interstate has a beta of 0.88, suggesting that its stock price is 12% less volatile than the S&P 500. Comparatively, Markel Corporation has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500.

Profitability

This table compares National Interstate and Markel Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
National Interstate 5.91% 10.13% 1.94%
Markel Corporation 1.60% 0.83% 0.27%

Institutional & Insider Ownership

84.9% of National Interstate shares are held by institutional investors. Comparatively, 76.4% of Markel Corporation shares are held by institutional investors. 11.8% of National Interstate shares are held by company insiders. Comparatively, 2.5% of Markel Corporation shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and recommmendations for National Interstate and Markel Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
National Interstate 0 0 0 0 N/A
Markel Corporation 0 3 1 0 2.25

Markel Corporation has a consensus target price of $1,066.67, suggesting a potential downside of 2.18%.

Earnings & Valuation

This table compares National Interstate and Markel Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
National Interstate N/A N/A N/A $1.38 N/A
Markel Corporation $5.61 billion 2.70 $455.68 million $4.50 242.31

Markel Corporation has higher revenue and earnings than National Interstate. National Interstate is trading at a lower price-to-earnings ratio than Markel Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

National Interstate beats Markel Corporation on 5 of the 9 factors compared between the two stocks.

About National Interstate

National Interstate Corporation and its subsidiaries operate as an insurance holding company that underwrites and sells traditional and alternative property and casualty insurance products to the passenger transportation, trucking and moving and storage industries, general commercial insurance to small businesses in Hawaii and Alaska and personal insurance to owners of recreational vehicles throughout the United States. The Company is a specialty property and casualty insurance company with a focus on the transportation industry. The Company operates through property and casualty insurance segment. The Company offers approximately 40 product lines in the specialty property and casualty insurance market, which it groups into approximately four general business components: alternative risk transfer (ART), transportation, specialty personal lines, and Hawaii and Alaska based on the class of business, insureds’ risk participation or geographic location.

About Markel Corporation

Markel Corporation is a financial holding company serving a range of markets. The Company’s principal business markets and underwrites specialty insurance products. It monitors and reports its ongoing underwriting operations in three segments: U.S. Insurance, International Insurance and Reinsurance. The Company, through its subsidiary Markel Ventures, Inc. (Markel Ventures), owns interests in various industrial and service businesses that operate outside of the specialty insurance marketplace. The U.S. Insurance segment includes all direct business and facultative placements written by its insurance subsidiaries domiciled in the United States. The International Insurance segment includes all direct business and facultative placements written by its insurance subsidiaries domiciled outside of the United States, including its syndicate at Lloyd’s of London (Lloyd’s). The Reinsurance segment includes all treaty reinsurance written across the Company.

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