Cincinnati Financial (NASDAQ:CINF – Get Free Report) and SelectQuote (NYSE:SLQT – Get Free Report) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, earnings, analyst recommendations, risk, profitability, valuation and institutional ownership.
Risk and Volatility
Cincinnati Financial has a beta of 0.53, suggesting that its stock price is 47% less volatile than the S&P 500. Comparatively, SelectQuote has a beta of 1.7, suggesting that its stock price is 70% more volatile than the S&P 500.
Profitability
This table compares Cincinnati Financial and SelectQuote’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Cincinnati Financial | 23.84% | 9.63% | 3.70% |
| SelectQuote | 3.84% | 19.70% | 5.33% |
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Cincinnati Financial | $12.63 billion | 1.98 | $2.39 billion | $21.20 | 7.67 |
| SelectQuote | $1.62 billion | 0.05 | $62.19 million | ($0.08) | -5.40 |
Cincinnati Financial has higher revenue and earnings than SelectQuote. SelectQuote is trading at a lower price-to-earnings ratio than Cincinnati Financial, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
65.2% of Cincinnati Financial shares are owned by institutional investors. Comparatively, 34.6% of SelectQuote shares are owned by institutional investors. 2.9% of Cincinnati Financial shares are owned by insiders. Comparatively, 13.1% of SelectQuote shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Analyst Recommendations
This is a summary of recent recommendations and price targets for Cincinnati Financial and SelectQuote, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Cincinnati Financial | 0 | 3 | 1 | 1 | 2.60 |
| SelectQuote | 2 | 1 | 0 | 1 | 2.00 |
Cincinnati Financial presently has a consensus target price of $195.40, suggesting a potential upside of 20.19%. SelectQuote has a consensus target price of $3.00, suggesting a potential upside of 594.44%. Given SelectQuote’s higher possible upside, analysts clearly believe SelectQuote is more favorable than Cincinnati Financial.
Summary
Cincinnati Financial beats SelectQuote on 9 of the 14 factors compared between the two stocks.
About Cincinnati Financial
Cincinnati Financial Corporation, together with its subsidiaries, provides property casualty insurance products in the United States. It operates through five segments: Commercial Lines Insurance, Personal Lines Insurance, Excess and Surplus Lines Insurance, Life Insurance, and Investments. The Commercial Lines Insurance segment offers coverage for commercial casualty, commercial property, commercial auto, and workers' compensation. It also provides contract and commercial surety bonds, and fidelity bonds; and machinery and equipment. The Personal Lines Insurance segment offers personal auto insurance; homeowner insurance; and dwelling fire, inland marine, personal umbrella liability, and watercraft coverages to individuals. The Excess and Surplus Lines Insurance segment offers commercial casualty insurance that covers businesses for third-party liability from accidents occurring on their premises or arising out of their operations, such as injuries sustained from products, as well as other coverages, including miscellaneous errors and omissions, professional liability, and excess liability; and commercial property insurance, which insures buildings, inventory, equipment, and business income from loss or damage due to various causes, such as fire, wind, hail, water, theft, and vandalism. The Life Insurance segment provides term life insurance products; universal life insurance products; worksite products, such as term life; and whole life insurance products, as well as annuities. The Investments segment invests in fixed-maturity investments, including taxable and tax-exempt bonds, redeemable preferred stocks, and mortgage-backed securities; and equity investments comprising common and nonredeemable preferred stocks. It also offers commercial leasing and financing services; and insurance brokerage services. Cincinnati Financial Corporation was founded in 1950 and is headquartered in Fairfield, Ohio.
About SelectQuote
SelectQuote, Inc. operates a technology-enabled, direct-to-consumer distribution platform that sells a range of insurance products and healthcare services in the United States. The company operates through three segments: Senior; Life; and Auto & Home. It distributes senior health policies, such as medicare advantage, medicare supplement, medicare part D, and other ancillary senior health insurance related products, including prescription drugs, dental, vision, and hearing plans; life insurance products, such as term life, final expense, and other ancillary products, including critical illness, accidental death, and juvenile insurance; homeowners, auto, dwelling fire, and other ancillary insurance products; and non-commercial auto and home property, and casualty policies. The company also provides SelectRx, an accredited patient-centered pharmacy home pharmacy, which offers essential prescription medications, OTC medications, customized medication packaging, medication therapy management, and long-term pharmacy care; and population health that helps members understand the benefits available under their health plans, and contracts with insurance carriers. SelectQuote, Inc. was incorporated in 1999 and is headquartered in Overland Park, Kansas.
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