Intact Financial (OTCMKTS:IFCZF – Get Free Report) and Arthur J. Gallagher & Co. (NYSE:AJG – Get Free Report) are both large-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, analyst recommendations, earnings, risk, profitability, valuation and institutional ownership.
Earnings & Valuation
This table compares Intact Financial and Arthur J. Gallagher & Co.”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Intact Financial | $20.46 billion | 1.48 | $2.41 billion | $13.01 | 13.21 |
| Arthur J. Gallagher & Co. | $13.94 billion | 4.28 | $1.49 billion | $6.03 | 38.65 |
Analyst Recommendations
This is a breakdown of recent ratings and price targets for Intact Financial and Arthur J. Gallagher & Co., as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Intact Financial | 0 | 2 | 5 | 0 | 2.71 |
| Arthur J. Gallagher & Co. | 0 | 5 | 16 | 0 | 2.76 |
Arthur J. Gallagher & Co. has a consensus target price of $280.74, suggesting a potential upside of 20.47%. Given Arthur J. Gallagher & Co.’s stronger consensus rating and higher probable upside, analysts plainly believe Arthur J. Gallagher & Co. is more favorable than Intact Financial.
Institutional & Insider Ownership
85.5% of Arthur J. Gallagher & Co. shares are held by institutional investors. 1.4% of Arthur J. Gallagher & Co. shares are held by company 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.
Profitability
This table compares Intact Financial and Arthur J. Gallagher & Co.’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Intact Financial | 11.45% | 16.77% | 5.06% |
| Arthur J. Gallagher & Co. | 9.96% | 13.28% | 4.03% |
Dividends
Intact Financial pays an annual dividend of $4.24 per share and has a dividend yield of 2.5%. Arthur J. Gallagher & Co. pays an annual dividend of $2.80 per share and has a dividend yield of 1.2%. Intact Financial pays out 32.6% of its earnings in the form of a dividend. Arthur J. Gallagher & Co. pays out 46.4% 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. Arthur J. Gallagher & Co. has raised its dividend for 15 consecutive years. Intact Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.
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.
About Arthur J. Gallagher & Co.
Arthur J. Gallagher & Co. engages in the provision of insurance brokerage, reinsurance brokerage, consulting, and third-party claims settlement and administration services. It operates through the following segments: Brokerage, Risk Management, and Corporate. The Brokerage segment consists of retail and wholesale insurance brokerage operations. The Risk Management segment provides contract claim settlement and administration services. The Corporate segment manages clean energy and other investments. The company was founded by Arthur J. Gallagher in 1927 and is headquartered in Rolling Meadows, IL.
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