Comparing XL Group (XL) & Old Republic International Corporation (ORI)

XL Group (NYSE: XL) and Old Republic International Corporation (NYSE:ORI) are both mid-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, valuation, analyst recommendations, profitability, earnings, dividends and institutional ownership.

Dividends

XL Group pays an annual dividend of $0.88 per share and has a dividend yield of 2.2%. Old Republic International Corporation pays an annual dividend of $0.76 per share and has a dividend yield of 3.9%. XL Group pays out 28.6% of its earnings in the form of a dividend. Old Republic International Corporation pays out 47.8% 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. XL Group has increased its dividend for 35 consecutive years and Old Republic International Corporation has increased its dividend for 4 consecutive years.

Volatility & Risk

XL Group has a beta of 1, suggesting that its stock price has a similar volatility profile to the S&P 500.Comparatively, Old Republic International Corporation has a beta of 1.3, suggesting that its stock price is 30% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for XL Group and Old Republic International Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
XL Group 1 5 6 0 2.42
Old Republic International Corporation 0 0 0 0 N/A

XL Group presently has a consensus price target of $45.82, suggesting a potential upside of 12.66%. Given XL Group’s higher possible upside, equities analysts plainly believe XL Group is more favorable than Old Republic International Corporation.

Institutional & Insider Ownership

95.3% of XL Group shares are held by institutional investors. Comparatively, 71.2% of Old Republic International Corporation shares are held by institutional investors. 3.0% of XL Group shares are held by insiders. Comparatively, 2.3% of Old Republic International Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares XL Group and Old Republic International Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
XL Group 7.53% 4.88% 1.06%
Old Republic International Corporation 7.64% 9.41% 2.26%

Valuation & Earnings

This table compares XL Group and Old Republic International Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
XL Group $11.02 billion 0.95 $1.47 billion $3.08 13.20
Old Republic International Corporation $5.99 billion 0.87 $758.60 million $1.59 12.36

XL Group has higher revenue and earnings than Old Republic International Corporation. Old Republic International Corporation is trading at a lower price-to-earnings ratio than XL Group, indicating that it is currently the more affordable of the two stocks.

Summary

XL Group beats Old Republic International Corporation on 11 of the 16 factors compared between the two stocks.

XL Group Company Profile

XL Group plc is an insurance and reinsurance company providing property, casualty and specialty products to industrial, commercial and professional firms, insurance companies and other enterprises. The Company operates through two segments: Insurance and Reinsurance. The Company’s Insurance segment is organized into four product divisions: Global Casualty (Casualty); Global Energy Property, & Construction (EPC); Global Professional (Professional), and Global Specialty (Specialty). Its insurance operations provide insurance policies for corporate risks that may require large limits, use of a captive insurance company and the need for a program of locally issued policies. The Reinsurance segment provides casualty, property risk, property catastrophe, specialty, and other reinsurance lines on a global basis with business being written on both a proportional and non-proportional treaty basis, and also on a facultative basis.

Old Republic International Corporation Company Profile

Old Republic International Corporation is a holding company. The Company is engaged in business of insurance underwriting and related services. The Company conducts its operations through various regulated insurance company subsidiaries, which are organized into three segments: General Insurance Group, Title Insurance Group and the Republic Financial Indemnity Group (RFIG) Run-off Business. The Company’s General Insurance segment consists of property and liability insurance, and offers coverages to businesses, government and other institutions. The Company’s Title Insurance Group business consists of the issuance of policies to real estate purchasers and investors based upon searches of the public records, which contain information concerning interests in real property. The Company’s RFIG run-off business consists of its mortgage guaranty and consumer credit indemnity (CCI) operations.

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