Head-To-Head Comparison: EverQuote (NASDAQ:EVER) & Principal Financial Group (NASDAQ:PFG)

Principal Financial Group (NASDAQ:PFG) and EverQuote (NASDAQ:EVER) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, valuation, dividends, risk, profitability and earnings.

Dividends

Principal Financial Group pays an annual dividend of $3.16 per share and has a dividend yield of 3.5%. EverQuote pays an annual dividend of $0.24 per share and has a dividend yield of 1.6%. Principal Financial Group pays out 60.0% of its earnings in the form of a dividend. EverQuote pays out 16.8% 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. Principal Financial Group has raised its dividend for 2 consecutive years. Principal Financial Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Principal Financial Group and EverQuote’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Principal Financial Group	7.58%	16.09%	0.57%
EverQuote	8.36%	38.19%	25.60%

Analyst Ratings

This is a summary of current ratings and price targets for Principal Financial Group and EverQuote, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Principal Financial Group	0	0	1	0	3.00
EverQuote	0	1	3	1	3.00

EverQuote has a consensus price target of $34.00, indicating a potential upside of 131.92%. Given EverQuote’s higher probable upside, analysts clearly believe EverQuote is more favorable than Principal Financial Group.

Volatility and Risk

Principal Financial Group has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500. Comparatively, EverQuote has a beta of 0.5, suggesting that its stock price is 50% less volatile than the S&P 500.

Insider and Institutional Ownership

75.1% of Principal Financial Group shares are owned by institutional investors. Comparatively, 91.5% of EverQuote shares are owned by institutional investors. 1.1% of Principal Financial Group shares are owned by insiders. Comparatively, 25.5% of EverQuote shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Principal Financial Group and EverQuote”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Principal Financial Group	$15.63 billion	1.29	$1.57 billion	$5.27	17.15
EverQuote	$644.66 million	0.82	$32.17 million	$1.43	10.25

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

Summary

EverQuote beats Principal Financial Group on 9 of the 17 factors compared between the two stocks.

About Principal Financial Group

Principal Financial Group, Inc. provides retirement, asset management, and insurance products and services to businesses, individuals, and institutional clients worldwide. The company operates through Retirement and Income Solutions, Principal Global Investors, Principal International, and U.S. Insurance Solutions segments. The Retirement and Income Solutions segment provides a portfolio of asset accumulation products and services for retirement savings and income. It offers products and services for defined contribution plans, including 401(k) and 403(b) plans, defined benefit pension plans, nonqualified executive benefit plans, employee stock ownership plans, equity compensation, and pension risk transfer services; individual retirement accounts; investment only products; and mutual funds, individual variable annuities, and bank products. The Principal Global Investors segment provides equity, fixed income, real estate, and other alternative investments, as well as asset allocation, stable value management, and other structured investment strategies. The Principal International segment offers pension accumulation products and services, mutual funds, asset management, income annuities, and life insurance accumulation products, as well as voluntary savings plans in Brazil, Chile, Mexico, China, Hong Kong Special Administrative Region, India, and Southeast Asia. The U.S. Insurance Solutions segment provides specialty benefits, such as group dental and vision insurance, group life insurance, and group and individual disability insurance, as well as administers group dental, disability, and vision benefits; and individual life insurance products comprising universal, variable universal, indexed universal, and term life insurance products in the United States. It also offers insurance solutions for small and medium-sized businesses and their owners, as well as executives. Principal Financial Group, Inc. was founded in 1879 and is based in Des Moines, Iowa.

About EverQuote

EverQuote, Inc. operates an online marketplace for insurance shopping in the United States. The company offers auto, home and renters, and life insurance. The company serves carriers and agents, as well as indirect distributors. The company was formerly known as AdHarmonics, Inc., and changed its name to EverQuote, Inc. in November 2014. EverQuote, Inc. was incorporated in 2008 and is based in Cambridge, Massachusetts.