Stewart Information Services (NYSE:STC – Get Free Report) and Lincoln National (NYSE:LNC – 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 earnings, analyst recommendations, institutional ownership, risk, valuation, dividends and profitability.
Dividends
Stewart Information Services pays an annual dividend of $2.20 per share and has a dividend yield of 4.2%. Lincoln National pays an annual dividend of $1.80 per share and has a dividend yield of 4.5%. Stewart Information Services pays out 48.2% of its earnings in the form of a dividend. Lincoln National pays out 15.6% 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. Stewart Information Services has raised its dividend for 4 consecutive years. Lincoln National is clearly the better dividend stock, given its higher yield and lower payout ratio.
Insider and Institutional Ownership
96.9% of Stewart Information Services shares are held by institutional investors. Comparatively, 72.8% of Lincoln National shares are held by institutional investors. 2.9% of Stewart Information Services shares are held by insiders. Comparatively, 1.0% of Lincoln National shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Profitability
This table compares Stewart Information Services and Lincoln National’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Stewart Information Services | 4.12% | 10.02% | 5.12% |
| Lincoln National | 12.21% | 17.35% | 0.41% |
Analyst Ratings
This is a summary of recent recommendations for Stewart Information Services and Lincoln National, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Stewart Information Services | 0 | 3 | 4 | 0 | 2.57 |
| Lincoln National | 1 | 5 | 7 | 0 | 2.46 |
Stewart Information Services currently has a consensus price target of $80.25, indicating a potential upside of 54.25%. Lincoln National has a consensus price target of $48.67, indicating a potential upside of 21.76%. Given Stewart Information Services’ stronger consensus rating and higher probable upside, equities analysts plainly believe Stewart Information Services is more favorable than Lincoln National.
Risk and Volatility
Stewart Information Services has a beta of 1.04, meaning that its share price is 4% more volatile than the S&P 500. Comparatively, Lincoln National has a beta of 1.16, meaning that its share price is 16% more volatile than the S&P 500.
Valuation and Earnings
This table compares Stewart Information Services and Lincoln National”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Stewart Information Services | $3.27 billion | 0.49 | $115.54 million | $4.56 | 11.41 |
| Lincoln National | $19.46 billion | 0.39 | $1.18 billion | $11.54 | 3.46 |
Lincoln National has higher revenue and earnings than Stewart Information Services. Lincoln National is trading at a lower price-to-earnings ratio than Stewart Information Services, indicating that it is currently the more affordable of the two stocks.
Summary
Lincoln National beats Stewart Information Services on 9 of the 17 factors compared between the two stocks.
About Stewart Information Services
Stewart Information Services Corporation, through its subsidiaries, provides title insurance and real estate transaction related services in the United States and internationally. The company involves in searching, examining, closing, and insuring the condition of the title to real property. It also offers home and personal insurance services; services for tax-deferred exchanges; and digital customer engagement platform services. It also provides appraisal management, online notarization and closing, credit and real estate information, and search and valuation services. The company serves homebuyers and sellers, residential and commercial real estate professionals, mortgage lenders and servicers, title agencies and real estate attorneys, and home builders through direct operations, network of independent agencies, and other businesses. The company was founded in 1893 and is headquartered in Houston, Texas.
About Lincoln National
Lincoln National Corporation, through its subsidiaries, operates multiple insurance and retirement businesses in the United States. It operates in four segments: Life Insurance, Annuities, Group Protection, and Retirement Plan Services. The Life Insurance segment provides life insurance products, including term insurance, universal life insurance (UL), indexed universal life insurance, variable universal life insurance (VUL), linked-benefit UL and VUL products, and critical illness and long-term care riders. The Annuities segment offers variable, fixed, and registered index-linked annuities. The Group Protection segment offers group non-medical insurance products consisting of short and long-term disability and statutory disability; paid family medical leave administration and absence management services; term life; dental and vision; and accident, critical illness, and hospital indemnity benefits and services to the employer marketplace through various forms of employee-paid and employer-paid plans. The Retirement Plan Services segment provides employers with retirement plan products and services primarily in the defined contribution retirement plan marketplace; individual and group variable annuities, group fixed annuities, and mutual fund-based programs; and various plan services, including plan recordkeeping, compliance testing, participant education, and trust and custodial services. The company distributes its products through consultants, brokers, planners, agents, financial advisors, third-party administrators, and other intermediaries. Lincoln National Corporation was founded in 1905 and is headquartered in Radnor, Pennsylvania.
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