Head-To-Head Comparison: Jack Henry & Associates (NASDAQ:JKHY) & Kingsway Financial Services (NYSE:KWY)

Kingsway Financial Services (NYSE:KWY) and Jack Henry & Associates (NASDAQ:JKHY) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their profitability, institutional ownership, valuation, risk, analyst recommendations, earnings and dividends.

Earnings & Valuation

This table compares Kingsway Financial Services and Jack Henry & Associates”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kingsway Financial Services	$134.97 million	2.05	-$10.73 million	($0.30)	-31.87
Jack Henry & Associates	$2.54 billion	3.98	$502.78 million	$6.97	20.72

Jack Henry & Associates has higher revenue and earnings than Kingsway Financial Services. Kingsway Financial Services is trading at a lower price-to-earnings ratio than Jack Henry & Associates, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations for Kingsway Financial Services and Jack Henry & Associates, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kingsway Financial Services	1	0	0	0	1.00
Jack Henry & Associates	0	5	12	1	2.78

Jack Henry & Associates has a consensus target price of $191.47, suggesting a potential upside of 32.57%. Given Jack Henry & Associates’ stronger consensus rating and higher possible upside, analysts plainly believe Jack Henry & Associates is more favorable than Kingsway Financial Services.

Risk & Volatility

Kingsway Financial Services has a beta of 0.25, meaning that its share price is 75% less volatile than the S&P 500. Comparatively, Jack Henry & Associates has a beta of 0.56, meaning that its share price is 44% less volatile than the S&P 500.

Insider & Institutional Ownership

72.4% of Kingsway Financial Services shares are held by institutional investors. Comparatively, 98.8% of Jack Henry & Associates shares are held by institutional investors. 41.4% of Kingsway Financial Services shares are held by company insiders. Comparatively, 0.6% of Jack Henry & Associates shares are held 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.

Profitability

This table compares Kingsway Financial Services and Jack Henry & Associates’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kingsway Financial Services	-6.69%	-61.62%	-4.45%
Jack Henry & Associates	19.76%	23.49%	16.34%

Summary

Jack Henry & Associates beats Kingsway Financial Services on 14 of the 15 factors compared between the two stocks.

About Kingsway Financial Services

Kingsway Financial Services Inc., through its subsidiaries, engages in the extended warranty business services, asset management, and real estate businesses. The company operates through three segments: Extended Warranty, Leased Real Estate, and Kingsway Search Xcelerator. The Extended Warranty segment markets, sells, and administers vehicle service agreements and related products for new and used automobiles, motorcycles, and ATVs. This segment also sells new home warranty products, as well as offers uninsured warrant administration services to homebuilders and homeowners; markets and distributes warranty products to manufacturers, distributors, and installers of heating, ventilation and air conditioning, standby generator, commercial LED lighting, and commercial refrigeration equipment; and provides equipment breakdown and maintenance support services to companies. The Leased Real Estate segment owns a parcel of real property consisting of approximately 192 acres located in the State of Texas. The Kingsway Search Xcelerator offers outsourced finance and human resources consulting services, including operational accounting, such as bookkeeping, accounting, financial reporting, and analysis and strategic finance services; technical accounting comprising initial public offerings, SEC reporting, and international consolidation services; human resources, workforce management, and compliance support services; and advisory services. The company offers its products and services through credit unions, dealers, homebuilders, and consumers. Kingsway Financial Services Inc. was incorporated in 1989 and is based in Itasca, Illinois.

About Jack Henry & Associates

Jack Henry & Associates, Inc. is a financial technology company, which engages in the provision of technology solutions and payment processing services. It operates through the following segments: Core, Payments, Complementary, and Corporate and Other. The Core segment provides core information processing platforms to banks and credit unions which consist of integrated applications required to process deposit, loan, and general ledger transactions, and maintain centralized customer and member information. The Payments segment includes secure payment processing tools and services including ATM, debit, and credit card processing services, online and mobile bill pay solutions, ACH origination and remote deposit capture processing, and risk management products and services. The Complementary segment focuses on additional software, hosted processing platforms, and services including call center support, network security management, consulting, and monitoring. The Corporate and Other segment offers hardware and other products. The company was founded by Jerry D. Hall and John W. Henry in 1976 and is headquartered in Monett, MO.