GWG (NASDAQ: GWGH) and Unum Group (NYSE:UNM) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, dividends, risk, valuation, earnings and institutional ownership.
Unum Group pays an annual dividend of $0.92 per share and has a dividend yield of 1.7%. GWG does not pay a dividend. Unum Group pays out 21.6% of its earnings in the form of a dividend. Unum Group has raised its dividend for 8 consecutive years.
Earnings & Valuation
This table compares GWG and Unum Group’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Unum Group||$11.05 billion||1.11||$931.40 million||$4.26||12.88|
Unum Group has higher revenue and earnings than GWG. GWG is trading at a lower price-to-earnings ratio than Unum Group, indicating that it is currently the more affordable of the two stocks.
This table compares GWG and Unum Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility & Risk
GWG has a beta of 0.4, meaning that its stock price is 60% less volatile than the S&P 500. Comparatively, Unum Group has a beta of 1.67, meaning that its stock price is 67% more volatile than the S&P 500.
Institutional and Insider Ownership
50.8% of GWG shares are owned by institutional investors. Comparatively, 91.5% of Unum Group shares are owned by institutional investors. 77.4% of GWG shares are owned by company insiders. Comparatively, 0.5% of Unum Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
This is a summary of current recommendations and price targets for GWG and Unum Group, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
GWG currently has a consensus price target of $14.50, indicating a potential upside of 74.28%. Unum Group has a consensus price target of $53.60, indicating a potential downside of 2.35%. Given GWG’s stronger consensus rating and higher probable upside, research analysts clearly believe GWG is more favorable than Unum Group.
Unum Group beats GWG on 11 of the 16 factors compared between the two stocks.
GWG Holdings, Inc. is the parent company of GWG Life, is a financial services company. The Company is focused on transforming the life insurance industry through its products and services. The Company has developed a new suite of options for the life insurance secondary market called LifeCare Xchange (LCX). This new capability provides seniors with the exchange value of their life insurance policies they can apply to long-term care and other post-retirement needs. Through its subsidiary GWG Life, LLC, seeks to further transform the industry by applying proprietary M-Panel epigenetic technology to disrupt traditional life insurance underwriting practices.
About Unum Group
Unum Group is a provider of financial protection benefits in the United States and the United Kingdom. The Company’s products include disability, life, accident, critical illness, dental and vision, and other related services. Its segments include Unum US, Unum UK, Colonial Life, Closed Block and Corporate. Its Unum US segment includes group long-term and short-term disability insurance, group life and accidental death and dismemberment products, and supplemental and voluntary lines of business. Its Unum UK segment includes insurance for group long-term disability, group life, and supplemental lines of business, which include dental, individual disability and critical illness products. Its Colonial Life segment includes insurance for accident, sickness, and disability products, life products, and cancer and critical illness products issued primarily by Colonial Life & Accident Insurance Company and marketed to employees. Its Closed Block segment consists of other insurance products.
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