Critical Review: Hallmark Financial Services (NASDAQ: HALL) vs. MediaAlpha (NYSE: MAX)


Hallmark Financial Services (NASDAQ:HALL – Get Rating) and MediaAlpha (NYSE:MAX – Get Rating) are both small cap finance companies, but which is the better investment? We’ll compare the two companies based on the strength of their profitability, dividends, institutional ownership, valuation, earnings, risk and analyst recommendations.

Valuation and benefits

This table compares revenue, earnings per share (EPS), and valuation of Hallmark Financial Services and MediaAlpha.

Gross revenue Price/sales ratio Net revenue Earnings per share Price/earnings ratio
Hallmark Financial Services $404.70 million 0.11 $9.00 million ($0.16) -15.63
MediaAlpha $645.27 million 0.87 -$5.28 million ($0.38) -24.26

Hallmark Financial Services has higher earnings, but lower earnings than MediaAlpha. MediaAlpha trades at a lower price-to-earnings ratio than Hallmark Financial Services, indicating that it is currently the more affordable of the two stocks.

Institutional and insider ownership

19.1% of Hallmark Financial Services shares are held by institutional investors. Comparatively, 65.5% of MediaAlpha shares are held by institutional investors. 28.7% of Hallmark Financial Services stock is held by insiders of the company. Comparatively, 9.6% of MediaAlpha’s stock is held by company insiders. Strong institutional ownership indicates that endowments, hedge funds, and large money managers believe a stock is poised for long-term growth.

Analyst Notes

This is a breakdown of recent ratings and recommendations for Hallmark Financial Services and MediaAlpha, as provided by MarketBeat.com.

Sales Ratings Hold odds Buy reviews Strong buy odds Rating
Hallmark Financial Services 0 0 0 0 N / A
MediaAlpha 0 3 1 0 2.25

Hallmark Financial Services currently has a consensus target price of $6.00, indicating a potential upside of 140.00%. MediaAlpha has a consensus target price of $18.60, indicating 101.74% upside potential. Given Hallmark Financial Services’ likely higher upside, analysts clearly think Hallmark Financial Services is more favorable than MediaAlpha.

Profitability

This table compares the net margins, return on equity, and return on assets of Hallmark Financial Services and MediaAlpha.

Net margins Return on equity return on assets
Hallmark Financial Services -0.74% -3.62% -0.42%
MediaAlpha -2.06% N / A -3.97%

Risk and Volatility

Hallmark Financial Services has a beta of 1.24, which suggests its stock price is 24% more volatile than the S&P 500. By comparison, MediaAlpha has a beta of 0.67, which suggests its stock price is 33% less volatile than the S&P 500.

Summary

Hallmark Financial Services beats MediaAlpha on 8 out of 13 factors compared between the two stocks.

Hallmark Financial Services Company Profile (Get a rating)

Hallmark Financial Services, Inc. underwrites, markets, distributes and services property and casualty insurance products to businesses and individuals in the United States. The Company operates through Specialty Commercial, Standard Commercial and Personal segments. The Specialty Commercial segment offers primary and excess insurance products and services for commercial vehicles; primary and excess liability, excess liability of public entities, and E&S and garage liability insurance products and services; commercial property primary and excess insurance for catastrophic and non-catastrophic risks; professional indemnity insurance products and services primarily intended for businesses, healthcare professionals, medical establishments and aged care establishments; and property and casualty insurance and satellite launch products and services, as well as various specialty programs. The Standard Commercial segment provides property and casualty insurance products and services. The Personal segment offers automobile and non-standard renter insurance products and services for individuals. It markets its insurance products through independent general agents, retail agents and specialized brokers. The company was incorporated in 1987 and is based in Dallas, Texas.

MediaAlpha Company Profile (Get an assessment)

MediaAlpha, Inc., through its subsidiaries, operates an insurance customer acquisition platform in the United States. He optimizes customer acquisition across various P&C, health and life insurance verticals. The company was founded in 2014 and is based in Los Angeles, California. MediaAlpha, Inc. is a subsidiary of White Mountains Insurance Group, Ltd.



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