Financial Analysis: Amerisafe (AMSF) & AmTrust Financial Services (NASDAQ:AFSI)
Amerisafe (NASDAQ: AFSI) and AmTrust Financial Services (NASDAQ:AFSI) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, risk, analyst recommendations, dividends, institutional ownership and profitability.
This is a breakdown of recent ratings for Amerisafe and AmTrust Financial Services, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|AmTrust Financial Services||0||5||0||0||2.00|
Amerisafe pays an annual dividend of $0.88 per share and has a dividend yield of 1.4%. AmTrust Financial Services pays an annual dividend of $0.51 per share and has a dividend yield of 3.5%. Amerisafe pays out 28.6% of its earnings in the form of a dividend. Amerisafe has raised its dividend for 4 consecutive years and AmTrust Financial Services has raised its dividend for 11 consecutive years. AmTrust Financial Services is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings & Valuation
This table compares Amerisafe and AmTrust Financial Services’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Amerisafe||$375.21 million||3.33||$46.23 million||$3.08||21.04|
|AmTrust Financial Services||$5.96 billion||0.48||-$348.88 million||N/A||N/A|
Amerisafe has higher earnings, but lower revenue than AmTrust Financial Services.
Insider and Institutional Ownership
37.1% of AmTrust Financial Services shares are held by institutional investors. 1.8% of Amerisafe shares are held by insiders. Comparatively, 50.8% of AmTrust Financial Services shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
This table compares Amerisafe and AmTrust Financial Services’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|AmTrust Financial Services||2.56%||-14.82%||-1.58%|
Risk and Volatility
Amerisafe has a beta of 0.72, indicating that its stock price is 28% less volatile than the S&P 500. Comparatively, AmTrust Financial Services has a beta of 1.2, indicating that its stock price is 20% more volatile than the S&P 500.
AMERISAFE, Inc., an insurance holding company, provides workers' compensation insurance in the United States. Its workers' compensation insurance policies provide benefits to injured employees for temporary or permanent disability, death, and medical and hospital expenses. The company serves small to mid-sized employers involved in construction, trucking, logging and lumber, manufacturing, agriculture, maritime, oil and gas, and other industries through agencies. AMERISAFE, Inc. was incorporated in 1985 and is based in DeRidder, Louisiana.
About AmTrust Financial Services
AmTrust Financial Services, Inc. provides property and casualty insurance in the United States and internationally. The company operates in three segments: Small Commercial Business, Specialty Risk and Extended Warranty, and Specialty Program. The Small Commercial Business segment offers workers' compensation insurance products; and commercial package, and other property and casualty insurance products, such as commercial property, general liability, inland marine, employment practices liability, commercial automobile, and umbrella coverage to small businesses. The Specialty Risk and Extended Warranty segment provides custom designed coverages, such as accidental damage plans, mechanical breakdown protection, and payment protection plans in connection with the sale of consumer and commercial goods; and coverage for niche property, casualty, and specialty liability risks comprising general liability, employers' liability, and professional and medical liability. The Specialty Program segment offers workers' compensation, general liability, commercial auto liability, property coverage, excess and surplus lines programs, and other specialty commercial property and casualty insurance products to small and middle market companies. The company also provides reinsurance services primarily for personal and commercial automotive business. It distributes its policies third-party brokers, agents, retailers, or administrators. AmTrust Financial Services, Inc. was founded in 1998 and is based in New York, New York.
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