Comparing SelectQuote (NYSE:SLQT) & American Coastal Insurance (NASDAQ:ACIC)

SelectQuote (NYSE:SLQT) and American Coastal Insurance (NASDAQ:ACIC) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, risk, institutional ownership, earnings, dividends and analyst recommendations.

Earnings & Valuation

This table compares SelectQuote and American Coastal Insurance”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SelectQuote	$1.62 billion	0.05	$62.19 million	($0.08)	-5.36
American Coastal Insurance	$335.44 million	1.49	$106.84 million	$1.76	5.99

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

Profitability

This table compares SelectQuote and American Coastal Insurance’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SelectQuote	3.84%	19.70%	5.33%
American Coastal Insurance	28.02%	24.36%	7.40%

Analyst Recommendations

This is a summary of current ratings and target prices for SelectQuote and American Coastal Insurance, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SelectQuote	1	2	0	1	2.25
American Coastal Insurance	0	2	1	1	2.75

SelectQuote presently has a consensus target price of $3.00, suggesting a potential upside of 599.30%. American Coastal Insurance has a consensus target price of $13.00, suggesting a potential upside of 23.34%. Given SelectQuote’s higher probable upside, equities analysts clearly believe SelectQuote is more favorable than American Coastal Insurance.

Volatility & Risk

SelectQuote has a beta of 2.01, meaning that its share price is 101% more volatile than the S&P 500. Comparatively, American Coastal Insurance has a beta of -0.55, meaning that its share price is 155% less volatile than the S&P 500.

Insider and Institutional Ownership

34.6% of SelectQuote shares are owned by institutional investors. Comparatively, 22.1% of American Coastal Insurance shares are owned by institutional investors. 11.6% of SelectQuote shares are owned by insiders. Comparatively, 49.2% of American Coastal Insurance shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

American Coastal Insurance beats SelectQuote on 9 of the 13 factors compared between the two stocks.

About SelectQuote

SelectQuote, Inc. operates a technology-enabled, direct-to-consumer distribution platform that sells a range of insurance products and healthcare services in the United States. The company operates through three segments: Senior; Life; and Auto & Home. It distributes senior health policies, such as medicare advantage, medicare supplement, medicare part D, and other ancillary senior health insurance related products, including prescription drugs, dental, vision, and hearing plans; life insurance products, such as term life, final expense, and other ancillary products, including critical illness, accidental death, and juvenile insurance; homeowners, auto, dwelling fire, and other ancillary insurance products; and non-commercial auto and home property, and casualty policies. The company also provides SelectRx, an accredited patient-centered pharmacy home pharmacy, which offers essential prescription medications, OTC medications, customized medication packaging, medication therapy management, and long-term pharmacy care; and population health that helps members understand the benefits available under their health plans, and contracts with insurance carriers. SelectQuote, Inc. was incorporated in 1999 and is headquartered in Overland Park, Kansas.

About American Coastal Insurance

American Coastal Insurance Corporation operates as a property and casualty insurance holding company that sources, writes, and services residential personal and commercial property, and casualty insurance policies in the United States. The company offers structure, content, and liability coverage for standard single-family homeowners, renters, and condominium unit owners. It also provides commercial multi-peril property insurance for residential condominium associations and apartments, as well as loss or damage to buildings, inventory, and equipment caused by fire, wind, hail, water, theft, and vandalism. In addition, the company offers equipment breakdown, identity theft, cyber security, and flood policies. The company markets and distributes its products through a network of independent agencies. The company was formerly known as United Insurance Holdings Corp. and changed its name to American Coastal Insurance Corporation in August 2023. American Coastal Insurance Corporation was founded in 1999 and is headquartered in Saint Petersburg, Florida.