Assured Guaranty Ltd. (AGO) vs Radian Group Inc. (RDN)

Assured Guaranty Ltd. and Radian Group Inc. are both Insurance Specialty companies. Radian Group Inc. is the larger, with a market value of $4.4B against $3.0B — 1.5× the size. Radian Group Inc. trades at the lower P/E: 8.4× against 9.3×. Radian Group Inc. grew revenue faster over the last twelve months: 41.9% against −10.6%. Assured Guaranty Ltd. has the higher net margin (37.3% vs 32.6%) and the lower return on invested capital (3.91% vs 7.69%). Both pay a dividend; Radian Group Inc. yields more (3.44% vs 1.36%). Across the 23 metrics below, Radian Group Inc. leads on 17 and Assured Guaranty Ltd. on 6.

Valuation

Metric AGO RDN Insurance Specialty median
P/E 9.27 8.42 9.15
P/S 3.27 2.72 1.84
P/B 0.55 0.93 1.16
Price to free cash flow 9.50 3.21 8.16
EV/EBITDA 10.26 6.90 7.51
EV/Sales 4.76 3.37 2.17
Earnings yield 10.79% 11.87% 10.79%
Free cash flow yield 10.52% 31.11% 11.79%

Profitability

Metric AGO RDN Insurance Specialty median
Gross margin 99.04% 69.22% 73.81%
Operating margin 46.38% 48.72% 17.70%
Net margin 37.34% 32.60% 13.80%
Free cash flow margin 34.47% 84.53% 34.47%
Return on equity 6.21% 11.53% 12.01%
Return on assets 2.84% 5.30% 4.12%
Return on invested capital 3.91% 7.69% 8.77%

Growth

Metric AGO RDN Insurance Specialty median
Revenue growth (TTM) (10.56%) 41.92% 7.53%
EPS growth (last fiscal year) 49.34% 5.61% —
Revenue growth, 5-year CAGR (0.09%) (3.61%) 2.24%
Net income growth, 5-year CAGR 6.80% 8.16% 0.00%

Health

Metric AGO RDN Insurance Specialty median
Debt to equity 0.31 0.26 0.15
Current ratio 0.42 0.39 0.53
Net debt to EBITDA 2.24 1.20 0.28

Dividend

Metric AGO RDN Insurance Specialty median
Dividend yield 1.36% 3.44% 2.60%
Payout ratio 0.21 0.21 0.21

Size

Metric AGO RDN Insurance Specialty median
Market cap 3.01b 4.44b 3.13b

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