Emergent Capital (OTCMKTS: EMGC) and Security National Financial (NASDAQ:SNFCA) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, analyst recommendations, profitability, earnings and valuation.

Institutional & Insider Ownership

8.5% of Security National Financial shares are held by institutional investors. 33.3% of Emergent Capital shares are held by insiders. Comparatively, 18.2% of Security National Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Emergent Capital and Security National Financial’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Emergent Capital $1.12 million 56.00 -$49.68 million ($0.98) -0.41
Security National Financial $307.21 million 0.24 $12.18 million $0.33 14.09

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

Risk & Volatility

Emergent Capital has a beta of 0.05, meaning that its stock price is 95% less volatile than the S&P 500. Comparatively, Security National Financial has a beta of 0.37, meaning that its stock price is 63% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings for Emergent Capital and Security National Financial, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Emergent Capital 0 0 1 0 3.00
Security National Financial 0 0 0 0 N/A

Profitability

This table compares Emergent Capital and Security National Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Emergent Capital -42.49% -12.80% -3.98%
Security National Financial 1.52% 3.18% 0.44%

Summary

Security National Financial beats Emergent Capital on 9 of the 12 factors compared between the two stocks.

About Emergent Capital

Emergent Capital, Inc., formerly Imperial Holdings, Inc., is a specialty finance company that invests in asset classes, primarily life settlements. The Company, through its subsidiary companies, owns a portfolio of approximately 630 life insurance policies (life settlements). The Company purchases individual policies and portfolios of life insurance policies and manages those assets based on actuarial and market data. The Company provides customized liquidity solutions to owners of illiquid financial assets in two markets, which include life finance and structured settlements. The Company focuses on lending to outright purchases of portfolios, to tertiary trades, as well as individual secondary market purchases. The Company invests in short and long-term life settlement investments.

About Security National Financial

Security National Financial Corporation is a holding company. The Company operates through three segments: life insurance, cemetery and mortuary, and mortgage loans. The life insurance segment is engaged in the business of selling and servicing selected lines of life insurance, annuity products, and accident and health insurance. The cemetery and mortuary segment consists of approximately seven mortuaries and five cemeteries in the state of Utah and a cemetery in the state of California. The mortgage loan segment originates and underwrites or otherwise purchases residential and commercial loans for new construction, existing homes and real estate projects. The Company is also engaged in pre-need selling of funeral, cemetery, mortuary and cremation services through its Utah and California operations. It also sells pre-need funeral, cemetery and cremation services.

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