Majestic Capital (OTCMKTS:MAJCQ) and ProAssurance (NYSE:PRA) Financial Analysis

Majestic Capital (OTCMKTS:MAJCQ) and ProAssurance (NYSE:PRA) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, dividends, profitability, valuation, risk and earnings.

Insider & Institutional Ownership

85.6% of ProAssurance shares are held by institutional investors. 14.3% of Majestic Capital shares are held by insiders. Comparatively, 1.0% of ProAssurance shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations and price targets for Majestic Capital and ProAssurance, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Majestic Capital	0	0	0	0	0.00
ProAssurance	0	2	1	0	2.33

ProAssurance has a consensus price target of $18.67, suggesting a potential upside of 12.11%. Given ProAssurance’s stronger consensus rating and higher probable upside, analysts clearly believe ProAssurance is more favorable than Majestic Capital.

Profitability

This table compares Majestic Capital and ProAssurance’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Majestic Capital	N/A	N/A	N/A
ProAssurance	3.71%	2.65%	0.54%

Earnings & Valuation

This table compares Majestic Capital and ProAssurance”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Majestic Capital	N/A	N/A	N/A	N/A	N/A
ProAssurance	$1.14 billion	0.75	-$38.60 million	$0.83	20.06

Majestic Capital has higher earnings, but lower revenue than ProAssurance.

Summary

ProAssurance beats Majestic Capital on 8 of the 9 factors compared between the two stocks.

About Majestic Capital

Majestic Capital, Ltd., through its subsidiaries, provides workers’ compensation insurance products. The company underwrites workers’ compensation insurance products through independent insurance brokers and agents to various size businesses; and excess and frequency coverage policies to self-insured entities. It offers primary workers’ compensation insurance to employers in Alaska, Arizona, California, Florida, Hawaii, Idaho, Illinois, Montana, Nevada, New Jersey, New Mexico, New York, Oregon, Utah, Virginia, and Washington. The company also engages in underwriting reinsurance. In addition, it offers various management services, including general management, underwriting, risk assessment, general recordkeeping, and regulatory compliance services; safety and loss control services; and claims management services to self-insured groups under fee-for-service arrangements. Further, the company acts as a broker for insurers and places the excess coverage for the groups. It serves transportation, healthcare, wholesale and retail, manufacturing, and hospitality industries; contractors; and colleges and universities. Majestic Capital, Ltd. was formerly known as CRM Holdings, Ltd. and changed its name to Majestic Capital, Ltd. in May 2010. Majestic Capital, Ltd. was founded in 1999 and is based in Hamilton, Bermuda.

About ProAssurance

ProAssurance Corporation, through its subsidiaries, provides property and casualty insurance, and reinsurance products in the United States. The company operates through Specialty Property and Casualty, Workers’ Compensation Insurance, and Segregated Portfolio Cell Reinsurance segments. It offers professional liability insurance to healthcare providers and institutions, and attorneys and their firms; medical technology liability insurance to medical technology and life sciences companies; and custom alternative risk solutions, including assumed reinsurance, loss portfolio transfers, and captive cell programs for healthcare professional liability insureds. The company also provides workers’ compensation insurance products, such as guaranteed cost policies, policyholder dividend policies, retrospectively rated policies, and deductible policies, as well as alternative market solutions that include program design, fronting, claims administration, risk management, SPC rental, asset management, and SPC management services for individual companies, agencies, groups, and associations. The company also participates in Syndicate 1729 at Lloyd’s of London for underwriting. It markets its products through independent agencies and brokers, as well as an internal business development team. The company was founded in 1976 and is headquartered in Birmingham, Alabama.