EMC Insurance Group (EMCI) versus Fairfax Financial Holdings Ltd Subordinate Voting Shares (FRFHF) Head-To-Head Analysis

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EMC Insurance Group (OTCMKTS: FRFHF) and Fairfax Financial Holdings Ltd Subordinate Voting Shares (OTCMKTS:FRFHF) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, profitability, institutional ownership and analyst recommendations.

Institutional & Insider Ownership

28.2% of EMC Insurance Group shares are held by institutional investors. Comparatively, 1.0% of Fairfax Financial Holdings Ltd Subordinate Voting Shares shares are held by institutional investors. 2.9% of EMC Insurance Group shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares EMC Insurance Group and Fairfax Financial Holdings Ltd Subordinate Voting Shares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
EMC Insurance Group 3.23% 3.30% 1.15%
Fairfax Financial Holdings Ltd Subordinate Voting Shares 10.81% 9.71% 2.55%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for EMC Insurance Group and Fairfax Financial Holdings Ltd Subordinate Voting Shares, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
EMC Insurance Group 0 1 1 0 2.50
Fairfax Financial Holdings Ltd Subordinate Voting Shares 0 0 0 0 N/A

EMC Insurance Group presently has a consensus price target of $30.50, suggesting a potential upside of 20.46%. Given EMC Insurance Group’s higher probable upside, research analysts plainly believe EMC Insurance Group is more favorable than Fairfax Financial Holdings Ltd Subordinate Voting Shares.

Valuation & Earnings

This table compares EMC Insurance Group and Fairfax Financial Holdings Ltd Subordinate Voting Shares’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
EMC Insurance Group $652.29 million 0.84 $39.23 million $1.22 20.75
Fairfax Financial Holdings Ltd Subordinate Voting Shares $16.22 billion 0.90 $1.74 billion N/A N/A

Fairfax Financial Holdings Ltd Subordinate Voting Shares has higher revenue and earnings than EMC Insurance Group.

Dividends

EMC Insurance Group pays an annual dividend of $0.88 per share and has a dividend yield of 3.5%. Fairfax Financial Holdings Ltd Subordinate Voting Shares pays an annual dividend of $10.00 per share and has a dividend yield of 1.9%. EMC Insurance Group pays out 72.1% of its earnings in the form of a dividend. EMC Insurance Group has raised its dividend for 8 consecutive years. EMC Insurance Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

EMC Insurance Group has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500. Comparatively, Fairfax Financial Holdings Ltd Subordinate Voting Shares has a beta of 0.29, suggesting that its stock price is 71% less volatile than the S&P 500.

Summary

EMC Insurance Group beats Fairfax Financial Holdings Ltd Subordinate Voting Shares on 8 of the 15 factors compared between the two stocks.

EMC Insurance Group Company Profile

EMC Insurance Group Inc., an insurance holding company, provides property and casualty insurance, and reinsurance products in the United States. It operates through two segments, Property and Casualty Insurance, and Reinsurance. The Property and Casualty Insurance segment underwrites commercial and personal lines of insurance products. Its commercial lines of insurance products comprise automobile, property, workers' compensation, and liability, as well as other products that provide protection with respect to burglary and theft loss, aircraft, marine, and other types of losses; and personal lines of insurance products include automobile, homeowners, and umbrella policies. The Reinsurance segment provides reinsurance for other insurers and reinsurers. EMC Insurance Group Inc. offers its products to small and medium-sized businesses, institutions, and individual consumers through independent insurance agents. The company was founded in 1974 and is based in Des Moines, Iowa. EMC Insurance Group Inc. is a subsidiary of Employers Mutual Casualty Company.

Fairfax Financial Holdings Ltd Subordinate Voting Shares Company Profile

Fairfax Financial Holdings Limited, through its subsidiaries, provides property and casualty insurance and reinsurance, and investment management services in the United States, Canada, Asia, and internationally. The company also underwrites specialty insurance and reinsurance; develops, produces, markets, and distributes television programs; and franchises, owns, and operates dining restaurants and holiday resorts. In addition, it is involved in the provision of pet medical insurance and database services; retail of tableware and gifts, and home improvement goods, as well as sporting goods and sports apparel comprising golf equipment, consumables, and athletic apparel and accessories; investment of real estate; and provision of integrated travel and travel-related financial services. The company was formerly known as Markel Financial Holdings Limited and changed its name to Fairfax Financial Holdings Limited in 1987. Fairfax Financial Holdings Limited was founded in 1951 and is headquartered in Toronto, Canada.

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