Contrasting OneBeacon Insurance Group (OB) & Berkshire Hathaway (BRK.A)

OneBeacon Insurance Group (NYSE: OB) and Berkshire Hathaway (NYSE:BRK.A) are both financials companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, institutional ownership, profitability, valuation, analyst recommendations, risk and earnings.

Dividends

OneBeacon Insurance Group pays an annual dividend of $0.84 per share and has a dividend yield of 4.6%. Berkshire Hathaway does not pay a dividend. OneBeacon Insurance Group pays out 115.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Risk and Volatility

OneBeacon Insurance Group has a beta of 0.57, indicating that its share price is 43% less volatile than the S&P 500. Comparatively, Berkshire Hathaway has a beta of 0.86, indicating that its share price is 14% less volatile than the S&P 500.

Earnings & Valuation

This table compares OneBeacon Insurance Group and Berkshire Hathaway’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
OneBeacon Insurance Group $1.17 billion 1.46 $69.16 million $0.73 24.78
Berkshire Hathaway N/A N/A N/A $13,263.00 N/A

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

Profitability

This table compares OneBeacon Insurance Group and Berkshire Hathaway’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
OneBeacon Insurance Group 0.10% -0.12% 0.03%
Berkshire Hathaway 9.08% 5.83% 2.66%

Analyst Recommendations

This is a summary of recent recommendations and price targets for OneBeacon Insurance Group and Berkshire Hathaway, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
OneBeacon Insurance Group 0 0 0 0 N/A
Berkshire Hathaway 0 2 1 0 2.33

Berkshire Hathaway has a consensus price target of $295,000.00, indicating a potential upside of Infinity. Given Berkshire Hathaway’s higher probable upside, analysts plainly believe Berkshire Hathaway is more favorable than OneBeacon Insurance Group.

Institutional and Insider Ownership

17.3% of OneBeacon Insurance Group shares are owned by institutional investors. Comparatively, 26.6% of Berkshire Hathaway shares are owned by institutional investors. 76.6% of OneBeacon Insurance Group shares are owned by company insiders. Comparatively, 5.4% of Berkshire Hathaway shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Berkshire Hathaway beats OneBeacon Insurance Group on 10 of the 13 factors compared between the two stocks.

About OneBeacon Insurance Group

OneBeacon Insurance Group, Ltd. (OneBeacon) is a specialty property and casualty insurance writer that offers a range of insurance products in the United States. The Company’s segments include Specialty Products, Specialty Industries, and Investing, Financing and Corporate. As of December 31, 2016, the Specialty Products segment consisted of 10 underwriting operating segments representing an aggregation based on those that offer products, coverages and services to customers across the United States. As of December 31, 2016, the Specialty Industries segment consisted of six underwriting operating segments representing an aggregation based on those that focus on solving the needs of a particular customer or industry group. The Investing, Financing and Corporate segment includes the investing and financing activities for OneBeacon on a consolidated basis, and certain other activities conducted through the Company and its intermediate subsidiaries.

About Berkshire Hathaway

Berkshire Hathaway Inc. is a holding company owning subsidiaries engaged in various business activities. Its segments include Insurance, such as GEICO, Berkshire Hathaway Primary Group, General Re Corporation and Berkshire Hathaway Reinsurance Group; Burlington Northern Santa Fe, LLC, which is engaged in the operation of the railroad system; Berkshire Hathaway Energy, which includes regulated electric and gas utility; Manufacturing, which includes manufacturers of various products, including industrial, consumer and building products; McLane Company, which is engaged in the wholesale distribution of groceries and non-food items; Service and retailing, which includes providers of various services, including fractional aircraft ownership programs, aviation pilot training and various retailing businesses, and Finance and financial products, which includes manufactured housing and related consumer financing, transportation equipment, manufacturing and leasing, and furniture leasing.

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