Brown & Brown (NYSE:BRO) & Hannover Ruck (OTCMKTS:HVRRY) Head-To-Head Comparison

Brown & Brown (NYSE:BRO) and Hannover Ruck (OTCMKTS:HVRRY) are both large-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, earnings, dividends, profitability, analyst recommendations, valuation and risk.

Analyst Ratings

This is a summary of current recommendations for Brown & Brown and Hannover Ruck, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Brown & Brown	1	6	7	0	2.43
Hannover Ruck	1	1	0	1	2.33

Brown & Brown presently has a consensus target price of $118.08, suggesting a potential upside of 9.69%. Given Brown & Brown’s stronger consensus rating and higher possible upside, research analysts plainly believe Brown & Brown is more favorable than Hannover Ruck.

Profitability

This table compares Brown & Brown and Hannover Ruck’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Brown & Brown	20.84%	17.77%	6.76%
Hannover Ruck	8.46%	18.29%	3.17%

Dividends

Brown & Brown pays an annual dividend of $0.60 per share and has a dividend yield of 0.6%. Hannover Ruck pays an annual dividend of $0.92 per share and has a dividend yield of 1.8%. Brown & Brown pays out 16.7% of its earnings in the form of a dividend. Hannover Ruck pays out 27.5% 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.

Institutional and Insider Ownership

71.0% of Brown & Brown shares are held by institutional investors. Comparatively, 0.0% of Hannover Ruck shares are held by institutional investors. 17.0% of Brown & Brown 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.

Valuation and Earnings

This table compares Brown & Brown and Hannover Ruck”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Brown & Brown	$4.85 billion	6.36	$993.00 million	$3.59	29.99
Hannover Ruck	$28.55 billion	1.33	$2.52 billion	$3.35	15.66

Hannover Ruck has higher revenue and earnings than Brown & Brown. Hannover Ruck is trading at a lower price-to-earnings ratio than Brown & Brown, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Brown & Brown has a beta of 0.82, suggesting that its stock price is 18% less volatile than the S&P 500. Comparatively, Hannover Ruck has a beta of 0.45, suggesting that its stock price is 55% less volatile than the S&P 500.

Summary

Brown & Brown beats Hannover Ruck on 12 of the 17 factors compared between the two stocks.

About Brown & Brown

Brown & Brown, Inc. is an insurance agency, wholesale brokerage, insurance program and service organization. It engages in the provision of insurance brokerage services and casualty insurance underwriting services. It operates through the following segments: Retail, National Programs, Wholesale Brokerage, and Services. The Retail Segment receives fees in lieu of commissions. The National Programs segment acts as a managing general agent and provides professional liability and related package products for certain professionals, a range of insurance products for individuals, flood coverage, and targeted products and services designated for specific industries, trade groups, governmental entities and market niches. The Wholesale Brokerage segment markets and sells excess and surplus commercial and personal lines insurance, primarily through independent agents and brokers, as well as the company’s retail agents. The Services segment provides insurance-related services, including third-party claims administration and comprehensive medical utilization management services in both the workers’ compensation and all-lines liability arenas, as well as Medicare Set-aside services, social security disability and Medicare benefits advocacy services and claims adjusting services. The company was founded by J. Adrian Brown and Charles Covington Owen in 1939 and is headquartered in Daytona Beach, FL.

About Hannover Ruck

Hannover Rück SE, together with its subsidiaries, provides reinsurance products and services in Germany, the United Kingdom, France, Europe, the United States, Asia, Australia, Africa, and internationally. It operates through Property & Casualty Reinsurance; and Life & Health Reinsurance segments. The company provides property and casualty reinsurance solutions for agricultural, livestock, and bloodstock; aviation and space; catastrophe XL; credit, surety, and political risks; facultative; and marine and offshore energy businesses, as well as insurance-linked securities and structured reinsurance. It offers risk solutions in the areas of critical illness, disability, health, longevity, long term care, and mortality. In addition, the company offers group life, retirement, lifestyle, credit life, and Takaful reinsurance products. Further, the company provides various financial solutions, including new-business financing; monetization of embedded value; reserve and solvency relief; and reinsurance and solvency II businesses. The company was formerly known as Hannover Rückversicherung AG and changed its name to Hannover Rück SE in March 2013. Hannover Rück SE was founded in 1966 and is based in Hanover, Germany. Hannover Rück SE operates as a subsidiary of Talanx AG.