Hannover Ruck (OTCMKTS:HVRRY – Get Free Report) and Root (NASDAQ:ROOT – Get Free Report) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, earnings, risk, analyst recommendations, institutional ownership, dividends and valuation.
Profitability
This table compares Hannover Ruck and Root’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Hannover Ruck | 9.84% | 19.51% | 3.73% |
| Root | 3.78% | 20.33% | 3.56% |
Institutional and Insider Ownership
0.0% of Hannover Ruck shares are owned by institutional investors. Comparatively, 59.8% of Root shares are owned by institutional investors. 12.0% of Root shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Hannover Ruck | 1 | 1 | 0 | 2 | 2.75 |
| Root | 0 | 5 | 2 | 0 | 2.29 |
Root has a consensus target price of $82.25, suggesting a potential upside of 62.84%. Given Root’s higher possible upside, analysts clearly believe Root is more favorable than Hannover Ruck.
Risk & Volatility
Hannover Ruck has a beta of 0.2, meaning that its stock price is 80% less volatile than the S&P 500. Comparatively, Root has a beta of 2.89, meaning that its stock price is 189% more volatile than the S&P 500.
Earnings and Valuation
This table compares Hannover Ruck and Root”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Hannover Ruck | $30.30 billion | 1.16 | $2.99 billion | $4.23 | 11.47 |
| Root | $1.52 billion | 0.53 | $40.30 million | $3.34 | 15.12 |
Hannover Ruck has higher revenue and earnings than Root. Hannover Ruck is trading at a lower price-to-earnings ratio than Root, indicating that it is currently the more affordable of the two stocks.
Summary
Hannover Ruck beats Root on 8 of the 15 factors compared between the two stocks.
About Hannover Ruck
Hannover Rück SE, together with its subsidiaries, provides reinsurance products and services in Germany, the United Kingdom, France, Europe, the United States, Asia, Australia, Africa, and internationally. It operates through Property & Casualty Reinsurance; and Life & Health Reinsurance segments. The company provides property and casualty reinsurance solutions for agricultural, livestock, and bloodstock; aviation and space; catastrophe XL; credit, surety, and political risks; facultative; and marine and offshore energy businesses, as well as insurance-linked securities and structured reinsurance. It offers risk solutions in the areas of critical illness, disability, health, longevity, long term care, and mortality. In addition, the company offers group life, retirement, lifestyle, credit life, and Takaful reinsurance products. Further, the company provides various financial solutions, including new-business financing; monetization of embedded value; reserve and solvency relief; and reinsurance and solvency II businesses. The company was formerly known as Hannover Rückversicherung AG and changed its name to Hannover Rück SE in March 2013. Hannover Rück SE was founded in 1966 and is based in Hanover, Germany. Hannover Rück SE operates as a subsidiary of Talanx AG.
About Root
Root, Inc. provides insurance products and services in the United States. The company offers automobile, homeowners, and renters insurance products. It operates a direct-to-consumer model; and serves customers primarily through mobile applications, as well as through its website. The company's direct distribution channels also cover digital, media, and referral channels, as well as distribution partners and agencies. Root, Inc. was incorporated in 2015 and is headquartered in Columbus, Ohio.
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