Comparing AON (NYSE:AON) & Kingstone Companies (NASDAQ:KINS)

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

Dividends

Kingstone Companies pays an annual dividend of $0.24 per share and has a dividend yield of 1.2%. AON pays an annual dividend of $3.28 per share and has a dividend yield of 1.0%. Kingstone Companies pays out 9.9% of its earnings in the form of a dividend. AON pays out 18.0% 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. Kingstone Companies is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility and Risk

Kingstone Companies has a beta of 0.49, suggesting that its share price is 51% less volatile than the S&P 500. Comparatively, AON has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500.

Insider and Institutional Ownership

14.9% of Kingstone Companies shares are held by institutional investors. Comparatively, 86.1% of AON shares are held by institutional investors. 4.3% of Kingstone Companies shares are held by insiders. Comparatively, 1.0% of AON shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Kingstone Companies and AON”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kingstone Companies	$214.87 million	1.35	$40.77 million	$2.42	8.30
AON	$17.18 billion	4.26	$3.69 billion	$18.26	18.89

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

Analyst Ratings

This is a summary of recent recommendations and price targets for Kingstone Companies and AON, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kingstone Companies	0	1	1	0	2.50
AON	3	6	13	0	2.45

AON has a consensus target price of $369.12, suggesting a potential upside of 7.03%. Given AON’s higher possible upside, analysts plainly believe AON is more favorable than Kingstone Companies.

Profitability

This table compares Kingstone Companies and AON’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kingstone Companies	14.85%	30.78%	7.99%
AON	22.24%	40.46%	7.20%

Summary

AON beats Kingstone Companies on 11 of the 16 factors compared between the two stocks.

About Kingstone Companies

Kingstone Companies, Inc., through its subsidiary, provides property and casualty insurance products to individuals in the United States. It offers personal line of insurance products, such as homeowners and dwelling fire, cooperative/condominiums, renters, and personal umbrella policies. The company also provides for-hire vehicle physical damage only policies for livery and car service vehicles and taxicabs; and canine legal liability policies. In addition, it offers reinsurance products. The company underwrites its products through retail and wholesale agents and brokers. The company was formerly known as DCAP Group, Inc. and changed its name to Kingstone Companies, Inc. in July 2009. Kingstone Companies, Inc. was founded in 1886 and is headquartered in Kingston, New York.

About AON

Aon Plc engages in the provision of risk, health, and wealth solutions. It focuses on risk capital including claim management, reinsurance, risk analysis, management, retention, and transfer; and human capital involving analytics, health and benefits, investments, pensions and retirement, talent and rewards, and workplace wellbeing. The company was founded in 1982 and is headquartered in Dublin, Ireland.