China Life Insurance Company Limited (LFC) versus National Western Life Group (NWLI) Financial Analysis

China Life Insurance Company Limited (NYSE: LFC) and National Western Life Group (NASDAQ:NWLI) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, dividends, analyst recommendations, profitability, valuation and risk.

Valuation & Earnings

This table compares China Life Insurance Company Limited and National Western Life Group’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
China Life Insurance Company Limited $92.94 billion 0.24 $5.79 billion $0.53 28.45
National Western Life Group $788.97 million 1.54 $171.25 million $30.07 11.77

China Life Insurance Company Limited has higher revenue and earnings than National Western Life Group. National Western Life Group is trading at a lower price-to-earnings ratio than China Life Insurance Company Limited, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

China Life Insurance Company Limited has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500. Comparatively, National Western Life Group has a beta of 1.47, meaning that its share price is 47% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for China Life Insurance Company Limited and National Western Life Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
China Life Insurance Company Limited 0 3 3 0 2.50
National Western Life Group 0 0 0 0 N/A

Institutional and Insider Ownership

0.2% of China Life Insurance Company Limited shares are held by institutional investors. Comparatively, 79.0% of National Western Life Group shares are held by institutional investors. 1.0% of National Western Life 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.

Profitability

This table compares China Life Insurance Company Limited and National Western Life Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
China Life Insurance Company Limited 3.52% 6.67% 0.75%
National Western Life Group 13.10% 5.33% 0.78%

Dividends

China Life Insurance Company Limited pays an annual dividend of $0.14 per share and has a dividend yield of 0.9%. National Western Life Group pays an annual dividend of $0.36 per share and has a dividend yield of 0.1%. China Life Insurance Company Limited pays out 26.4% of its earnings in the form of a dividend. National Western Life Group pays out 1.2% 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. China Life Insurance Company Limited has increased its dividend for 3 consecutive years. China Life Insurance Company Limited is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

National Western Life Group beats China Life Insurance Company Limited on 8 of the 15 factors compared between the two stocks.

China Life Insurance Company Limited Company Profile

China Life Insurance Company Limited is a life insurance company. The Company provides a range of insurance products, including individual and group life insurance, health insurance and accident insurance products. It operates through three segments: Life Insurance, Health Insurance, and Accident Insurance. Its Life Insurance segment provides participating and non-participating life insurance and annuities to individuals and groups. Its Health Insurance segment provides short-term and long-term health insurance to individuals and groups. Its Accident Insurance segment provides short-term and long-term accident insurance to individuals and groups.

National Western Life Group Company Profile

National Western Life Insurance Company (National Western) is a stock life insurance company. The Company operates in two segments: Domestic Insurance Operations and International Insurance Operations. The products marketed under domestic insurance operations are annuities, universal life insurance and traditional life insurance, which include both term and whole life products. National Western’s international operations focus on foreign nationals in upper socioeconomic classes. The Company provides life insurance products for the savings and protection needs of approximately 126,700 policyholders and for the asset accumulation and retirement needs of 139,100 annuity contract holders. National Western offers a portfolio of individual whole life, universal life and term insurance plans, and annuities, including supplementary riders.

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