Sun Life Financial (NYSE:SLF – Get Free Report) and Lemonade (NYSE:LMND – Get Free Report) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, valuation, dividends, earnings, risk, analyst recommendations and institutional ownership.
Insider & Institutional Ownership
52.3% of Sun Life Financial shares are held by institutional investors. Comparatively, 80.3% of Lemonade shares are held by institutional investors. 12.2% of Lemonade shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Earnings and Valuation
This table compares Sun Life Financial and Lemonade”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sun Life Financial | $29.99 billion | 1.44 | $2.68 billion | $4.28 | 18.16 |
| Lemonade | $975.00 million | 3.66 | -$165.50 million | ($1.83) | -25.22 |
Sun Life Financial has higher revenue and earnings than Lemonade. Lemonade is trading at a lower price-to-earnings ratio than Sun Life Financial, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Sun Life Financial has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500. Comparatively, Lemonade has a beta of 1.87, indicating that its stock price is 87% more volatile than the S&P 500.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for Sun Life Financial and Lemonade, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sun Life Financial | 1 | 5 | 5 | 1 | 2.50 |
| Lemonade | 1 | 4 | 4 | 0 | 2.33 |
Sun Life Financial currently has a consensus target price of $98.67, suggesting a potential upside of 26.96%. Lemonade has a consensus target price of $63.50, suggesting a potential upside of 37.58%. Given Lemonade’s higher probable upside, analysts clearly believe Lemonade is more favorable than Sun Life Financial.
Profitability
This table compares Sun Life Financial and Lemonade’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sun Life Financial | 7.66% | 17.96% | 1.08% |
| Lemonade | -14.19% | -26.78% | -7.08% |
Summary
Sun Life Financial beats Lemonade on 10 of the 15 factors compared between the two stocks.
About Sun Life Financial
Sun Life Financial Inc., a financial services company, provides savings, retirement, and pension products worldwide. The company operates in five segments: Asset Management, Canada, U.S., Asia, and Corporate. It offers various insurance products, such as term and permanent life; personal health, which includes prescription drugs, dental, and vision care; critical illness; long-term care; and disability, as well as reinsurance. The company also provides advice for financial planning and retirement planning services; investments products, such as mutual funds, segregated funds, and annuities; and asset and investment management products consisting of pooled funds, institutional portfolios, and pension funds. In addition, it offers real estate services; manages equity capital in various private and listed funds, as well as mezzanine debt, middle market direct lending, high-yield bonds, and syndicated loans; and operates as an investment grade fixed income investor, real estate investment management advisor, infrastructure investment manager, and alternative credit investment manager. The company was formerly known as Sun Life Financial Services of Canada Inc. and changed its name to Sun Life Financial Inc. in July 2003. Sun Life Financial Inc. was founded in 1871 and is headquartered in Toronto, Canada.
About Lemonade
Lemonade, Inc. provides various insurance products through various channels in the United States, Europe, and the United Kingdom. Its insurance products include stolen or damaged property, and personal liability that protects its customers if they are responsible for an accident or damage to another person or their property. The company also offers renters, homeowners, car, pet, and life insurance products, as well as landlord insurance policies. In addition, it operates as an agent for other insurance companies. The company was formerly known as Lemonade Group, Inc. and changed its name to Lemonade, Inc. Lemonade, Inc. was incorporated in 2015 and is headquartered in New York, New York.
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