Contrasting AXIS Capital (NYSE:AXS) and United Fire Group (NASDAQ:UFCS)

United Fire Group (NASDAQ:UFCS) and AXIS Capital (NYSE:AXS) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, earnings, valuation, profitability, risk and dividends.

Analyst Ratings

This is a summary of current ratings and price targets for United Fire Group and AXIS Capital, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Fire Group	0	1	0	0	2.00
AXIS Capital	1	0	6	0	2.71

United Fire Group currently has a consensus target price of $26.00, indicating a potential downside of 17.59%. AXIS Capital has a consensus target price of $97.14, indicating a potential upside of 4.65%. Given AXIS Capital’s stronger consensus rating and higher probable upside, analysts plainly believe AXIS Capital is more favorable than United Fire Group.

Insider and Institutional Ownership

62.7% of United Fire Group shares are owned by institutional investors. Comparatively, 93.4% of AXIS Capital shares are owned by institutional investors. 6.0% of United Fire Group shares are owned by insiders. Comparatively, 0.5% of AXIS Capital shares are owned by 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.

Risk and Volatility

United Fire Group has a beta of 0.53, meaning that its share price is 47% less volatile than the S&P 500. Comparatively, AXIS Capital has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500.

Profitability

This table compares United Fire Group and AXIS Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Fire Group	4.15%	6.75%	1.51%
AXIS Capital	10.82%	19.24%	3.08%

Dividends

United Fire Group pays an annual dividend of $0.64 per share and has a dividend yield of 2.0%. AXIS Capital pays an annual dividend of $1.76 per share and has a dividend yield of 1.9%. United Fire Group pays out 33.0% of its earnings in the form of a dividend. AXIS Capital pays out 24.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. AXIS Capital has increased its dividend for 23 consecutive years.

Valuation & Earnings

This table compares United Fire Group and AXIS Capital”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Fire Group	$1.10 billion	0.73	-$29.70 million	$1.94	16.26
AXIS Capital	$5.64 billion	1.38	$376.29 million	$7.21	12.88

AXIS Capital has higher revenue and earnings than United Fire Group. AXIS Capital is trading at a lower price-to-earnings ratio than United Fire Group, indicating that it is currently the more affordable of the two stocks.

Summary

AXIS Capital beats United Fire Group on 14 of the 17 factors compared between the two stocks.

About United Fire Group

United Fire Group, Inc., together with its subsidiaries, provides property and casualty insurance for individuals and businesses in the United States. The company offers commercial and personal lines of property and casualty insurance; and reinsurance coverage for property and casualty insurance. Its commercial lines include fire and allied lines, other liability, automobile, workers’ compensation, fidelity and surety coverage, and other insurance products; and personal lines comprise automobile, and fire and allied lines coverage, including homeowners, as well as provides assumed reinsurance products. The company sells its products through a network of independent agencies. United Fire Group, Inc. was incorporated in 1946 and is headquartered in Cedar Rapids, Iowa.

About AXIS Capital

AXIS Capital Holdings Limited, through its subsidiaries, provides various specialty insurance and reinsurance products in Bermuda, the United States, and internationally. It operates through two segments, Insurance and Reinsurance. The Insurance segment offers professional insurance products that cover directors' and officers' liability, errors and omissions, employment practices, fiduciary, crime, professional indemnity, medical malpractice, and other financial insurance related coverages for commercial enterprises, financial institutions, not-for-profit organizations, and other professional service providers; and property insurance products for commercial buildings, residential premises, construction projects, property in transit, onshore renewable energy installations, and physical damage and business interruption following an act of terrorism. This segment also provides marine and aviation insurance services for offshore energy, renewable offshore energy, cargo, liability, including kidnap and ransom, fine art, specie, and hull war, hull and liability, and specific war coverage for passenger airlines, cargo operations, general aviation operations, airports, aviation authorities, security firms, and product manufacturers; personal accident, travel insurance, specialty health products for employer and affinity groups, and pet insurance products; and liability, cyber, and credit and political risk insurance services. The Reinsurance segment offers agriculture, marine and aviation, catastrophe, accidental and health, credit and surety, motor, professional, travel, life, engineering, property, and liability reinsurance products. AXIS Capital Holdings Limited was founded in 2001 and is headquartered in Pembroke, Bermuda.