First Acceptance (OTCMKTS:FACO) and Hamilton Insurance Group (NYSE:HG) Critical Review

Hamilton Insurance Group (NYSE:HG) and First Acceptance (OTCMKTS:FACO) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, valuation, earnings, risk, dividends, analyst recommendations and profitability.

Profitability

This table compares Hamilton Insurance Group and First Acceptance’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hamilton Insurance Group	21.88%	21.92%	6.70%
First Acceptance	12.41%	53.03%	13.17%

Analyst Ratings

This is a summary of recent recommendations for Hamilton Insurance Group and First Acceptance, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hamilton Insurance Group	0	1	4	0	2.80
First Acceptance	0	0	0	0	0.00

Hamilton Insurance Group currently has a consensus target price of $22.60, suggesting a potential upside of 20.99%. Given Hamilton Insurance Group’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Hamilton Insurance Group is more favorable than First Acceptance.

Earnings & Valuation

This table compares Hamilton Insurance Group and First Acceptance”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hamilton Insurance Group	$2.30 billion	0.82	$258.73 million	$4.47	4.18
First Acceptance	$560.58 million	0.21	$73.91 million	$2.09	1.51

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

Insider & Institutional Ownership

29.2% of Hamilton Insurance Group shares are owned by institutional investors. Comparatively, 0.1% of First Acceptance shares are owned by institutional investors. 2.7% of Hamilton Insurance Group shares are owned by company insiders. Comparatively, 9.5% of First Acceptance shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Hamilton Insurance Group beats First Acceptance on 10 of the 13 factors compared between the two stocks.

About Hamilton Insurance Group

Hamilton Insurance Group, Ltd., through its subsidiaries, provides underwriting specialty insurance and reinsurance risks in Bermuda and internationally. The company operates Hamilton Global Specialty, Hamilton Select, and Hamilton Re underwriting platforms. The company offers casualty reinsurance products, such as commercial motor, general liability, healthcare, multiline, personal motor, professional liability, umbrella and excess casualty, and worker's compensation and employer's liability reinsurance; property reinsurance and insurance; and specialty reinsurance solutions, including accident and health, aviation and space, crisis management, mortgage, financial lines, marine and energy, and multiline specialty. In addition, it offers accident and health, cyber, energy, environmental, financial lines, fine art and specie, kidnap and ransom, mergers and acquisitions, marine and energy liability, political risk and violence, professional liability, property binders, property direct and facultative, professional lines, space, upstream energy, excess casualty, war and terrorism, allied medical, management liability, medical professionals, general liability, products liability and contractors, and small business casualty insurance plans, as well as surety and treaty reinsurance products. The company was incorporated in 2013 and is headquartered in Pembroke, Bermuda.

About First Acceptance

First Acceptance Corporation, together with its subsidiaries, operates as a retailer, servicer, and underwriter of non-standard personal automobile insurance and related products in the United States. It issues non-standard automobile insurance policies to individuals based on their inability or unwillingness to obtain insurance coverage from standard carriers due to various factors, including their payment preference, failure to maintain continuous insurance coverage, or driving record. The company also underwrites auto and motorcycle insurance products; and renters, homeowners, commercial, pet, life, travel, outdoor vehicle, and hospital indemnity insurance products. In addition, it provides TeleMed, a subscription service that offers access to doctor for consulting, diagnosing, and prescribing medication for non-emergency illness. The company primarily distributes its products through its retail locations, as well as through call center and internet. As of December 31, 2021, it leased and operated 338 retail locations, and a call center. First Acceptance Corporation was founded in 1969 and is headquartered in Nashville, Tennessee.