Financial Review: Arch Capital Group (NASDAQ:ACGL) & Security National Financial (NASDAQ:SNFCA)

Arch Capital Group (NASDAQ:ACGL) and Security National Financial (NASDAQ:SNFCA) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, profitability, risk, dividends, earnings and institutional ownership.

Earnings and Valuation

This table compares Arch Capital Group and Security National Financial”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arch Capital Group	$19.93 billion	1.59	$4.40 billion	$12.79	7.27
Security National Financial	$344.59 million	0.71	$32.15 million	$1.39	6.42

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

Volatility & Risk

Arch Capital Group has a beta of 0.28, indicating that its stock price is 72% less volatile than the S&P 500. Comparatively, Security National Financial has a beta of 0.64, indicating that its stock price is 36% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Arch Capital Group and Security National Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arch Capital Group	1	7	6	0	2.36
Security National Financial	0	1	0	0	2.00

Arch Capital Group currently has a consensus target price of $110.82, suggesting a potential upside of 19.24%. Given Arch Capital Group’s stronger consensus rating and higher possible upside, equities analysts plainly believe Arch Capital Group is more favorable than Security National Financial.

Profitability

This table compares Arch Capital Group and Security National Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arch Capital Group	24.40%	17.06%	4.87%
Security National Financial	11.10%	9.13%	2.36%

Institutional and Insider Ownership

89.1% of Arch Capital Group shares are held by institutional investors. Comparatively, 45.6% of Security National Financial shares are held by institutional investors. 3.3% of Arch Capital Group shares are held by company insiders. Comparatively, 15.0% of Security National Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Arch Capital Group beats Security National Financial on 12 of the 14 factors compared between the two stocks.

About Arch Capital Group

Arch Capital Group Ltd., together with its subsidiaries, provides insurance, reinsurance, and mortgage insurance products worldwide. The company's Insurance segment offers primary and excess casualty coverages; loss sensitive primary casualty insurance programs; directors' and officers' liability, errors and omissions liability, employment practices and fiduciary liability, crime, professional indemnity, and other financial related coverages; medical professional and general liability insurance coverages; and workers' compensation and umbrella liability, as well as commercial automobile and inland marine products. It also provides property, energy, marine, and aviation insurance; travel insurance; accident, disability, and medical plan insurance coverages; captive insurance programs; employer's liability; contract and commercial surety coverages; and collateral protection, debt cancellation, and service contract reimbursement products. This segment markets its products through a group of licensed independent retail and wholesale brokers. Its Reinsurance segment provides casualty reinsurance for third party liability exposures; marine and aviation; motor reinsurance, whole account multi-line treaties, cyber, trade credit, surety, accident and health, workers' compensation catastrophe, agriculture, trade credit, and political risk products; reinsurance protection for catastrophic losses, and personal lines and commercial property exposures; life reinsurance; casualty clash; and risk management solutions. This segment markets its reinsurance products through brokers. The company's Mortgage segment offers direct mortgage insurance and mortgage reinsurance. The company was founded in 1995 and is based in Pembroke, Bermuda.

About Security National Financial

Security National Financial Corporation engages in the life insurance, cemetery and mortuary, and mortgage businesses. The company's Life Insurance segment is involved in selling and servicing lines of life insurance, annuity products, and accident and health insurance. It offers various life insurance products, including funeral plans and interest-sensitive life insurance, as well as other traditional life, accident, and health insurance products; annuity products comprising single and flexible premium deferred annuities, and immediate annuities; and diver's accident insurance policies. This segment also cedes and assumes various risks with various authorized unaffiliated reinsurers pursuant to reinsurance treaties. Its Cemetery and Mortuary segment operates eight mortuaries and five cemeteries in Utah; one cemetery in California; and four mortuaries and one cemetery in New Mexico. This segment also offers plots, interment vaults, mausoleum crypts, markers, caskets, urns, and other death care related products; and provides professional services of funeral directors, opening and closing of graves, use of chapels and viewing rooms, and use of automobiles and clothing. The company's Mortgages segment originates and underwrites residential and commercial loans for new construction, existing homes, and real estate projects primarily in Florida, Nevada, Texas, and Utah. It offers residential mortgage lending services to real estate brokers and builders, as well as directly with consumers. Security National Financial Corporation was founded in 1965 and is headquartered in Salt Lake City, Utah.