Comparing Progressive (NYSE:PGR) and Waterdrop (NYSE:WDH)

Waterdrop (NYSE:WDH) and Progressive (NYSE:PGR) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, risk, earnings, institutional ownership, valuation, dividends and profitability.

Earnings and Valuation

This table compares Waterdrop and Progressive”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Waterdrop	$568.81 million	0.63	$81.36 million	$0.21	4.75
Progressive	$87.67 billion	1.44	$11.31 billion	$19.94	10.89

Progressive has higher revenue and earnings than Waterdrop. Waterdrop is trading at a lower price-to-earnings ratio than Progressive, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Waterdrop has a beta of -0.09, meaning that its share price is 109% less volatile than the S&P 500. Comparatively, Progressive has a beta of 0.27, meaning that its share price is 73% less volatile than the S&P 500.

Dividends

Waterdrop pays an annual dividend of $0.05 per share and has a dividend yield of 5.0%. Progressive pays an annual dividend of $0.40 per share and has a dividend yield of 0.2%. Waterdrop pays out 23.8% of its earnings in the form of a dividend. Progressive pays out 2.0% 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.

Institutional and Insider Ownership

2.0% of Waterdrop shares are held by institutional investors. Comparatively, 85.3% of Progressive shares are held by institutional investors. 24.6% of Waterdrop shares are held by insiders. Comparatively, 0.3% of Progressive 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.

Analyst Ratings

This is a summary of current ratings for Waterdrop and Progressive, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Waterdrop	0	2	0	0	2.00
Progressive	2	14	7	0	2.22

Waterdrop currently has a consensus price target of $2.00, indicating a potential upside of 100.60%. Progressive has a consensus price target of $236.26, indicating a potential upside of 8.76%. Given Waterdrop’s higher probable upside, equities research analysts clearly believe Waterdrop is more favorable than Progressive.

Profitability

This table compares Waterdrop and Progressive’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Waterdrop	12.47%	10.87%	7.94%
Progressive	12.84%	32.92%	8.85%

Summary

Progressive beats Waterdrop on 13 of the 16 factors compared between the two stocks.

About Waterdrop

Waterdrop Inc., through its subsidiaries, provides online insurance brokerage services to match and connect users with related insurance products underwritten by insurance companies in the People's Republic of China. The company offers short-term health and long-term health and life insurance products and services. It also operates a medical crowdfunding platform. Waterdrop Inc. was founded in 2016 and is headquartered in Beijing, the People's Republic of China.

About Progressive

The Progressive Corporation, an insurance holding company, provides personal and commercial auto, personal residential and commercial property, business related general liability, and other specialty property-casualty insurance products and related services in the United States. It operates in three segments: Personal Lines, Commercial Lines, and Property. The Personal Lines segment writes insurance for personal autos and recreational vehicles (RV). This segment's products include personal auto insurance; and special lines products, including insurance for motorcycles, ATVs, RVs, watercrafts, snowmobiles, and related products. The Commercial Lines segment provides auto-related liability and physical damage insurance, and business-related general liability and property insurance for autos, vans, and pick-up trucks used by small businesses, as well as non-fleet taxis, black-car services, and airport taxis; tractors, trailers, and straight trucks primarily used by regional general freight and expeditor-type businesses, and long-haul operators; dump trucks used by light contractors and heavy constructions; log trucks and garbage trucks used by dirt, sand and gravel, logging, garbage/debris removal, and coal-type businesses; and tow trucks and wreckers used in towing services and gas/service station businesses. The Property segment writes residential property insurance for homeowners, other property owners, and renters, as well as offers manufactured homes, personal umbrella insurance, and primary and excess flood insurance. The company offers policy issuance and claims adjusting services; acts as an agent to homeowners, general liability, workers' compensation insurance, and other products; and reinsurance services. It sells its products through independent insurance agencies, as well as through mobile applications and over the phone. The Progressive Corporation was founded in 1937 and is headquartered in Mayfield Village, Ohio.