Cincinnati Financial (NASDAQ:CINF) versus Fidelis Insurance (NYSE:FIHL) Critical Survey

Cincinnati Financial (NASDAQ:CINFGet Free Report) and Fidelis Insurance (NYSE:FIHLGet Free Report) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, institutional ownership, earnings, profitability and dividends.

Institutional & Insider Ownership

64.8% of Cincinnati Financial shares are held by institutional investors. Comparatively, 39.5% of Fidelis Insurance shares are held by institutional investors. 3.0% of Cincinnati Financial shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Dividends

Cincinnati Financial pays an annual dividend of $3.24 per share and has a dividend yield of 2.7%. Fidelis Insurance pays an annual dividend of $0.40 per share and has a dividend yield of 2.2%. Cincinnati Financial pays out 27.8% of its earnings in the form of a dividend. Fidelis Insurance pays out 2.1% 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. Cincinnati Financial has raised its dividend for 64 consecutive years. Cincinnati Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Cincinnati Financial and Fidelis Insurance’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cincinnati Financial 18.41% 8.56% 3.03%
Fidelis Insurance 59.30% 20.23% 4.22%

Analyst Recommendations

This is a summary of current recommendations and price targets for Cincinnati Financial and Fidelis Insurance, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cincinnati Financial 0 4 2 0 2.33
Fidelis Insurance 0 4 4 0 2.50

Cincinnati Financial presently has a consensus target price of $113.67, indicating a potential downside of 4.35%. Fidelis Insurance has a consensus target price of $18.00, indicating a potential downside of 2.96%. Given Fidelis Insurance’s stronger consensus rating and higher probable upside, analysts plainly believe Fidelis Insurance is more favorable than Cincinnati Financial.

Valuation & Earnings

This table compares Cincinnati Financial and Fidelis Insurance’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cincinnati Financial $10.01 billion 1.86 $1.84 billion $11.67 10.18
Fidelis Insurance $3.59 billion 0.61 $2.13 billion $19.07 0.97

Fidelis Insurance has lower revenue, but higher earnings than Cincinnati Financial. Fidelis Insurance is trading at a lower price-to-earnings ratio than Cincinnati Financial, indicating that it is currently the more affordable of the two stocks.

Summary

Fidelis Insurance beats Cincinnati Financial on 9 of the 16 factors compared between the two stocks.

About Cincinnati Financial

(Get Free Report)

Cincinnati Financial Corporation, together with its subsidiaries, provides property casualty insurance products in the United States. It operates through five segments: Commercial Lines Insurance, Personal Lines Insurance, Excess and Surplus Lines Insurance, Life Insurance, and Investments. The Commercial Lines Insurance segment offers coverage for commercial casualty, commercial property, commercial auto, and workers' compensation. It also provides contract and commercial surety bonds, and fidelity bonds; and machinery and equipment. The Personal Lines Insurance segment offers personal auto insurance; homeowner insurance; and dwelling fire, inland marine, personal umbrella liability, and watercraft coverages to individuals. The Excess and Surplus Lines Insurance segment offers commercial casualty insurance that covers businesses for third-party liability from accidents occurring on their premises or arising out of their operations, such as injuries sustained from products, as well as other coverages, including miscellaneous errors and omissions, professional liability, and excess liability; and commercial property insurance, which insures buildings, inventory, equipment, and business income from loss or damage due to various causes, such as fire, wind, hail, water, theft, and vandalism. The Life Insurance segment provides term life insurance products; universal life insurance products; worksite products, such as term life; and whole life insurance products, as well as annuities. The Investments segment invests in fixed-maturity investments, including taxable and tax-exempt bonds, redeemable preferred stocks, and mortgage-backed securities; and equity investments comprising common and nonredeemable preferred stocks. It also offers commercial leasing and financing services; and insurance brokerage services. Cincinnati Financial Corporation was founded in 1950 and is headquartered in Fairfield, Ohio.

About Fidelis Insurance

(Get Free Report)

Fidelis Insurance Holdings Limited, together with its subsidiaries, provides insurance and reinsurance products in Bermuda, Ireland, and the United Kingdom. It operates in three segments: Specialty, Reinsurance, and Bespoke segments. The Specialty segment offers aviation and aerospace, energy, marine, property direct and facultative, and other specialty risk solutions. The Reinsurance segment provides property, retrocession, and whole account reinsurance solutions. The Bespoke segment offers customized risk solutions for clients that include credit and political risk, and other risk transfer opportunities. The company is also involved in specialty treaty reinsurance, and surety bonds and guarantees activities; and upstream energy, energy liability, and marine businesses; and provision of product recall and contamination, and marketing services. Fidelis Insurance Holdings Limited was incorporated in 2014 and is headquartered in Pembroke, Bermuda.

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