Markel Group (NYSE:MKL – Get Free Report) and Federal Signal (NYSE:FSS – Get Free Report) are both multi-sector conglomerates companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, profitability, valuation, institutional ownership and risk.
Analyst Recommendations
This is a breakdown of current ratings and target prices for Markel Group and Federal Signal, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Markel Group | 1 | 5 | 0 | 0 | 1.83 |
| Federal Signal | 0 | 1 | 4 | 1 | 3.00 |
Markel Group presently has a consensus target price of $2,025.00, indicating a potential upside of 1.45%. Federal Signal has a consensus target price of $139.25, indicating a potential upside of 17.34%. Given Federal Signal’s stronger consensus rating and higher possible upside, analysts plainly believe Federal Signal is more favorable than Markel Group.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Markel Group | $15.51 billion | 1.61 | $2.11 billion | $138.77 | 14.38 |
| Federal Signal | $2.18 billion | 3.32 | $246.60 million | $4.40 | 26.97 |
Markel Group has higher revenue and earnings than Federal Signal. Markel Group is trading at a lower price-to-earnings ratio than Federal Signal, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
77.1% of Markel Group shares are held by institutional investors. Comparatively, 92.7% of Federal Signal shares are held by institutional investors. 1.1% of Markel Group shares are held by insiders. Comparatively, 3.3% of Federal Signal shares are held by 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
Markel Group has a beta of 0.66, suggesting that its share price is 34% less volatile than the S&P 500. Comparatively, Federal Signal has a beta of 1.23, suggesting that its share price is 23% more volatile than the S&P 500.
Profitability
This table compares Markel Group and Federal Signal’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Markel Group | 10.85% | 7.90% | 2.10% |
| Federal Signal | 11.56% | 21.18% | 13.14% |
Summary
Federal Signal beats Markel Group on 12 of the 15 factors compared between the two stocks.
About Markel Group
Markel Group Inc., a diverse holding company, engages in marketing and underwriting specialty insurance products in the United States, Bermuda, the United Kingdom, and Germany. The company offers general and professional liability, personal lines, marine and energy, specialty programs, and workers' compensation insurance products; and property coverages that include fire, allied lines, and other specialized property coverages, including catastrophe-exposed property risks, such as earthquake and wind. It also offers credit and surety products, and collateral protection insurance products. In addition, the company offers transaction, directors and officers, and healthcare liability reinsurance; and specialty treaty reinsurance products comprising credit and surety, workers' compensation, marine and energy, public entity, mortgage default, aviation and space, agriculture, and discrete political violence and national terror pools. Further, it provides construction services, consumer and building products, transportation-related products, consulting services, and equipment manufacturing products, as well as healthcare, leasing, and investment services. Additionally, the company operates as an insurance and investment fund manager offering a range of investment products, including insurance-linked securities, catastrophe bonds, insurance swaps, traditional reinsurance contracts, industry loss warranties and other financial instruments; and program services. It also manages funds with third parties. The company was formerly known as Markel Corporation and changed its name to Markel Group Inc. in May 2023. Markel Group Inc. was founded in 1930 and is based in Glen Allen, Virginia.
About Federal Signal
Federal Signal Corp. engages in the design and manufacture of products and integrated solutions for municipal, governmental, industrial, and commercial customers. It operates through the Environmental Solutions Group and Safety and Security Systems Group segments. The Environment Solutions Group segment is involved in the manufacture and supply of street sweeper vehicles, sewer cleaners, vacuum loader trucks, hydro-excavation trucks, and water blasting equipment. The Safety and Security Systems Group segment offers comprehensive systems and products that law enforcement, fire rescue, emergency medical services, campuses, military facilities, and industrial sites use to protect people and property. The company was founded in 1901 and is headquartered in Oak Brook, IL.
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