Sampo (OTCMKTS:SAXPY – Get Free Report) and Fairfax Financial (OTCMKTS:FRFHF – Get Free Report) are both large-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.
Profitability
This table compares Sampo and Fairfax Financial’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sampo | N/A | 19.05% | 5.71% |
| Fairfax Financial | 14.16% | 15.05% | 4.26% |
Insider & Institutional Ownership
0.0% of Sampo shares are held by institutional investors. Comparatively, 10.4% of Fairfax Financial shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Risk and Volatility
Analyst Recommendations
This is a summary of current recommendations and price targets for Sampo and Fairfax Financial, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sampo | 1 | 2 | 1 | 1 | 2.40 |
| Fairfax Financial | 0 | 3 | 3 | 0 | 2.50 |
Earnings & Valuation
This table compares Sampo and Fairfax Financial”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sampo | $13.08 billion | 8.28 | $2.26 billion | $1.44 | 14.15 |
| Fairfax Financial | $31.60 billion | 1.08 | $4.77 billion | $202.33 | 7.82 |
Fairfax Financial has higher revenue and earnings than Sampo. Fairfax Financial is trading at a lower price-to-earnings ratio than Sampo, indicating that it is currently the more affordable of the two stocks.
Dividends
Sampo pays an annual dividend of $0.35 per share and has a dividend yield of 1.7%. Fairfax Financial pays an annual dividend of $15.00 per share and has a dividend yield of 0.9%. Sampo pays out 24.3% of its earnings in the form of a dividend. Fairfax Financial pays out 7.4% 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.
Summary
Fairfax Financial beats Sampo on 9 of the 15 factors compared between the two stocks.
About Sampo
Sampo Oyj, together with its subsidiaries, engages in the provision of non-life insurance products and services in Finland, Sweden, Norway, Denmark, Estonia, Lithuania, Latvia, and the United Kingdom. The company operates through If, Topdanmark, Hastings, Mandatum, and Holding segments. It offers property, casualty, liability, accident, sickness, household, homeowner, motor, travel, marine, aviation, transport, forest, livestock, health, workers compensation, car, van, and bike insurance services, as well as reinsurance services. The company was founded in 1909 and is based in Helsinki, Finland.
About Fairfax Financial
Fairfax Financial Holdings Limited, through its subsidiaries, provides property and casualty insurance and reinsurance, and investment management services in the United States, Canada, Asia, and internationally. The company operates through Property and Casualty Insurance and Reinsurance, Life insurance and Run-off, and Non-Insurance Companies segments. It insures against losses to property from fire, explosion, earthquake, windstorm, flood, terrorism, boiler explosion, machinery breakdown, and construction defects, as well as underwrites automobile, commercial and personal property, and crop insurance. The company also offers workers' compensation, automobile, employer's liability, accident and health, medical malpractice, professional liability, and umbrella coverage insurance products; marine, aerospace, surety risk, and other risks and liabilities insurance products; and reinsurance products. In addition, it franchises, owns, and operates restaurants; retails sports lifestyle products; provides integrated travel and travel-related financial services, as well as advanced digital tools for agriculture; owns and operates holiday resorts; originates, processes, and distributes value-added pulses and staple foods; develops, manages, and invests in hospitality real estate. The company was formerly known as Markel Financial Holdings Limited and changed its name to Fairfax Financial Holdings Limited in 1987. Fairfax Financial Holdings Limited was incorporated in 1951 and is headquartered in Toronto, Canada.
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