Primerica (NYSE: PRI) and FBL Financial Group (NYSE:FFG) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, dividends, risk, valuation, profitability and earnings.

Risk and Volatility

Primerica has a beta of 1.14, suggesting that its share price is 14% more volatile than the S&P 500. Comparatively, FBL Financial Group has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500.

Dividends

Primerica pays an annual dividend of $0.80 per share and has a dividend yield of 1.0%. FBL Financial Group pays an annual dividend of $1.76 per share and has a dividend yield of 2.6%. Primerica pays out 16.3% of its earnings in the form of a dividend. FBL Financial Group pays out 38.2% 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. Primerica has raised its dividend for 6 consecutive years and FBL Financial Group has raised its dividend for 4 consecutive years.

Earnings and Valuation

This table compares Primerica and FBL Financial Group’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Primerica $1.62 billion 2.12 $411.75 million $4.90 15.62
FBL Financial Group $736.38 million 2.30 $184.11 million $4.61 14.75

Primerica has higher revenue and earnings than FBL Financial Group. FBL Financial Group is trading at a lower price-to-earnings ratio than Primerica, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Primerica and FBL Financial Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Primerica 14.41% 18.48% 1.97%
FBL Financial Group 15.70% 9.12% 1.16%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Primerica and FBL Financial Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Primerica 0 4 1 0 2.20
FBL Financial Group 0 1 0 0 2.00

Primerica presently has a consensus price target of $84.67, suggesting a potential upside of 10.60%. Given Primerica’s stronger consensus rating and higher possible upside, research analysts plainly believe Primerica is more favorable than FBL Financial Group.

Insider & Institutional Ownership

94.9% of Primerica shares are owned by institutional investors. Comparatively, 28.6% of FBL Financial Group shares are owned by institutional investors. 0.9% of Primerica shares are owned by company insiders. Comparatively, 0.6% of FBL Financial Group shares are owned by company 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.

Summary

Primerica beats FBL Financial Group on 14 of the 17 factors compared between the two stocks.

About Primerica

Primerica Inc. (Primerica) is a distributor of financial products to middle-income households in the United States and Canada. The Company operates through three segments: Term Life Insurance, Investment and Savings Products, and Corporate and Other Distributed Products. The Term Life Insurance segment includes underwriting profits on its in-force book of term life insurance policies, net of reinsurance, which are underwritten by its life insurance company subsidiaries. The Investment and Savings Products segment includes retail and managed mutual funds, and annuities distributed through licensed broker-dealer subsidiaries and includes segregated funds, an individual annuity savings product that it underwrites in Canada through Primerica Life Insurance Company of Canada (Primerica Life Canada). In the United States, it distributes mutual fund and annuity products of various third-party companies. It also earns fees for account servicing on a subset of the mutual funds it distributes.

About FBL Financial Group

FBL Financial Group, Inc. sells individual life insurance and annuity products under the brand name of Farm Bureau Financial Services. The Company’s segments are Annuity Segment, which sells a variety of traditional annuity products; Life Insurance Segment, which sells a range of traditional and universal life insurance products, and Corporate and Other segment, which provides various support operations, corporate capital and other product lines. It also offers life and annuity products through its subsidiary, Greenfields Life Insurance Company. Its other subsidiaries support various functional areas and affiliates by providing investment advisory and marketing and distribution services. It manages all aspects of two Farm Bureau affiliated property-casualty insurance companies, Farm Bureau Property & Casualty Insurance Company and Western Agricultural Insurance Company.

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