Critical Contrast: James River Group (NASDAQ:JRVR) versus Fidelis Insurance (NYSE:FIHL)

Fidelis Insurance (NYSE:FIHL) and James River Group (NASDAQ:JRVR) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, risk, valuation, earnings and dividends.

Institutional & Insider Ownership

82.0% of Fidelis Insurance shares are held by institutional investors. Comparatively, 95.2% of James River Group shares are held by institutional investors. 16.5% of James River Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Risk and Volatility

Fidelis Insurance has a beta of 0.53, suggesting that its stock price is 47% less volatile than the S&P 500. Comparatively, James River Group has a beta of 0.06, suggesting that its stock price is 94% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Fidelis Insurance and James River Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fidelis Insurance	1	2	3	0	2.33
James River Group	0	2	3	0	2.60

Fidelis Insurance presently has a consensus target price of $20.86, indicating a potential upside of 23.10%. James River Group has a consensus target price of $10.40, indicating a potential upside of 114.83%. Given James River Group’s stronger consensus rating and higher probable upside, analysts clearly believe James River Group is more favorable than Fidelis Insurance.

Profitability

This table compares Fidelis Insurance and James River Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fidelis Insurance	20.17%	15.27%	3.36%
James River Group	-20.84%	3.90%	0.41%

Dividends

Fidelis Insurance pays an annual dividend of $0.40 per share and has a dividend yield of 2.4%. James River Group pays an annual dividend of $0.04 per share and has a dividend yield of 0.8%. Fidelis Insurance pays out 10.1% of its earnings in the form of a dividend. James River Group pays out -1.0% 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.

Earnings and Valuation

This table compares Fidelis Insurance and James River Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fidelis Insurance	$3.60 billion	0.56	$2.13 billion	$3.96	4.28
James River Group	$812.01 million	0.23	-$107.68 million	($4.05)	-1.20

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

Summary

Fidelis Insurance beats James River Group on 10 of the 15 factors compared between the two stocks.

About Fidelis Insurance

Fidelis Insurance Holdings Limited, a specialty insurer, provides insurance and reinsurance solutions in Bermuda, the Republic of 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, as well as other risk transfer opportunities, including political violence and terrorism, limited cyber reinsurance, tax liabilities, title, transactional liabilities, and other bespoke solutions. Fidelis Insurance Holdings Limited was incorporated in 2014 and is headquartered in Pembroke, Bermuda.

About James River Group

James River Group Holdings, Ltd., through its subsidiaries, provides specialty insurance services. It operates through Excess and Surplus Lines, and Specialty Admitted Insurance segments. The Excess and Surplus Lines segment underwrites liability and property insurance in the United States Puerto Rice, and the United States Virgin Islands. This segment distributes its insurance policies primarily through wholesale insurance brokers. The Specialty Admitted Insurance segment provides insurance for fronting, program administrators, managing general agents, and independent retail agents. James River Group Holdings, Ltd. was founded in 2002 and is headquartered in Pembroke, Bermuda.