Analyzing Progressive (NYSE:PGR) & American Coastal Insurance (NASDAQ:ACIC)

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

Volatility & Risk

Progressive has a beta of 0.28, indicating that its stock price is 72% less volatile than the S&P 500. Comparatively, American Coastal Insurance has a beta of -0.51, indicating that its stock price is 151% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Progressive	12.92%	33.47%	9.05%
American Coastal Insurance	31.32%	32.26%	8.91%

Earnings & Valuation

This table compares Progressive and American Coastal Insurance”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Progressive	$89.42 billion	1.44	$11.31 billion	$19.67	11.21
American Coastal Insurance	$334.03 million	1.60	$106.84 million	$2.10	5.25

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

Analyst Ratings

This is a breakdown of current ratings and target prices for Progressive and American Coastal Insurance, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Progressive	3	13	6	0	2.14
American Coastal Insurance	1	1	1	0	2.00

Progressive presently has a consensus price target of $236.84, suggesting a potential upside of 7.44%. Given Progressive’s stronger consensus rating and higher possible upside, analysts clearly believe Progressive is more favorable than American Coastal Insurance.

Insider & Institutional Ownership

85.3% of Progressive shares are held by institutional investors. Comparatively, 22.1% of American Coastal Insurance shares are held by institutional investors. 0.3% of Progressive shares are held by company insiders. Comparatively, 49.2% of American Coastal Insurance shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Progressive pays an annual dividend of $0.40 per share and has a dividend yield of 0.2%. American Coastal Insurance pays an annual dividend of $0.50 per share and has a dividend yield of 4.5%. Progressive pays out 2.0% of its earnings in the form of a dividend. American Coastal Insurance pays out 23.8% 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.

Summary

Progressive beats American Coastal Insurance on 12 of the 16 factors compared between the two stocks.

About Progressive

The Progressive Corporation, an insurance holding company, provides personal and commercial auto, personal residential and commercial property, business related general liability, and other specialty property-casualty insurance products and related services in the United States. It operates in three segments: Personal Lines, Commercial Lines, and Property. The Personal Lines segment writes insurance for personal autos and recreational vehicles (RV). This segment's products include personal auto insurance; and special lines products, including insurance for motorcycles, ATVs, RVs, watercrafts, snowmobiles, and related products. The Commercial Lines segment provides auto-related liability and physical damage insurance, and business-related general liability and property insurance for autos, vans, and pick-up trucks used by small businesses, as well as non-fleet taxis, black-car services, and airport taxis; tractors, trailers, and straight trucks primarily used by regional general freight and expeditor-type businesses, and long-haul operators; dump trucks used by light contractors and heavy constructions; log trucks and garbage trucks used by dirt, sand and gravel, logging, garbage/debris removal, and coal-type businesses; and tow trucks and wreckers used in towing services and gas/service station businesses. The Property segment writes residential property insurance for homeowners, other property owners, and renters, as well as offers manufactured homes, personal umbrella insurance, and primary and excess flood insurance. The company offers policy issuance and claims adjusting services; acts as an agent to homeowners, general liability, workers' compensation insurance, and other products; and reinsurance services. It sells its products through independent insurance agencies, as well as through mobile applications and over the phone. The Progressive Corporation was founded in 1937 and is headquartered in Mayfield Village, Ohio.

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.