American International Group (NYSE:AIG – Get Free Report) and Intact Financial (OTCMKTS:IFCZF – Get Free Report) are both large-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, dividends, profitability, risk, earnings, analyst recommendations and institutional ownership.
Valuation & Earnings
This table compares American International Group and Intact Financial”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| American International Group | $26.77 billion | 1.47 | $3.10 billion | $5.47 | 13.73 |
| Intact Financial | $20.46 billion | 1.59 | $2.41 billion | $13.01 | 14.26 |
Profitability
This table compares American International Group and Intact Financial’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| American International Group | 11.13% | 11.05% | 2.78% |
| Intact Financial | 11.45% | 16.77% | 5.06% |
Dividends
American International Group pays an annual dividend of $2.00 per share and has a dividend yield of 2.7%. Intact Financial pays an annual dividend of $4.26 per share and has a dividend yield of 2.3%. American International Group pays out 36.6% of its earnings in the form of a dividend. Intact Financial pays out 32.7% 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. American International Group has increased its dividend for 3 consecutive years. American International Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Recommendations
This is a breakdown of current recommendations and price targets for American International Group and Intact Financial, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| American International Group | 0 | 12 | 8 | 0 | 2.40 |
| Intact Financial | 0 | 2 | 5 | 0 | 2.71 |
American International Group currently has a consensus target price of $88.37, indicating a potential upside of 17.70%. Given American International Group’s higher probable upside, analysts clearly believe American International Group is more favorable than Intact Financial.
Insider & Institutional Ownership
90.6% of American International Group shares are owned by institutional investors. 0.6% of American International Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
About American International Group
American International Group, Inc. offers insurance products for commercial, institutional, and individual customers in North America and internationally. It operates through three segments: General Insurance, Life and Retirement, and Other Operations. The General Insurance segment provides commercial and industrial property insurance, including business interruption and package insurance that cover exposure to made and natural disasters; general liability, environmental, commercial automobile liability, workers’ compensation, excess casualty, and crisis management insurance products; and professional liability insurance. This segment offers marine, energy-related property insurance, aviation, political risk, trade credit, trade finance, and portfolio solutions, as well as operates reinsurance business; voluntary and sponsor-paid personal accident, and supplemental health products; and personal auto and personal property insurance. Its Life and Retirement segment offers individual retirement products, including variable, fixed index, and fixed annuities, as well as retail mutual funds; group retirement products comprising record-keeping, plan administrative and compliance services, financial planning, and advisory solutions; life insurance, including term and universal life insurance; and institutional markets products, which includes wrap products, structured settlement, pension risk transfer annuities, corporate and bank-owned life insurance, high net worth, and guaranteed investment contract products. It distributes its products through a network of brokers, agents, advisors, banks, and other distributors. The company was founded in 1919 and is headquartered in New York, New York.
About Intact Financial
Intact Financial Corporation, through its subsidiaries, provides property and casualty insurance products to individuals and businesses in Canada, the United States, the United Kingdom, and internationally. The company offers insurance, such as personal auto which provides coverage from accidents, third party liability, and physical damage; personal property which provides protection for homes and contents from risks, including fire, theft, vandalism, water damages, other damages, and personal liability; and commercial line and specialty line insurance which provides commercial auto, property, and liability coverages. It also provides pet and business insurance, as well as provides risk management solutions. The company serves its products to accident and health, technology, ocean and inland marine, builder's risk, and entertainment, as well as financial services and institutions; and various products to specialty property, surety, tuition reimbursement, management liability, and cyber and environmental institutions. It offers specialty insurance products including travel insurance, brokers, direct to consumer, agencies, wholesalers, affinity group, Intact Prestige, and managing general agent platform. The company was formerly known as ING Canada Inc. and changed its name to Intact Financial Corporation in 2009. Intact Financial Corporation was founded in 1809 and is based in Toronto, Canada.
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