Critical Comparison: Skyward Specialty Insurance Group (NASDAQ:SKWD) and RenaissanceRe (NYSE:RNR)

Skyward Specialty Insurance Group (NASDAQ:SKWD) and RenaissanceRe (NYSE:RNR) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, profitability, earnings, analyst recommendations, institutional ownership, dividends and valuation.

Analyst Recommendations

This is a summary of current recommendations and price targets for Skyward Specialty Insurance Group and RenaissanceRe, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Skyward Specialty Insurance Group	0	3	7	1	2.82
RenaissanceRe	2	5	4	0	2.18

Skyward Specialty Insurance Group presently has a consensus price target of $56.25, indicating a potential upside of 13.80%. RenaissanceRe has a consensus price target of $279.90, indicating a potential upside of 16.20%. Given RenaissanceRe’s higher probable upside, analysts clearly believe RenaissanceRe is more favorable than Skyward Specialty Insurance Group.

Valuation & Earnings

This table compares Skyward Specialty Insurance Group and RenaissanceRe”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Skyward Specialty Insurance Group	$1.15 billion	1.73	$85.98 million	$2.89	17.10
RenaissanceRe	$11.65 billion	1.02	$1.87 billion	$35.02	6.88

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

Institutional & Insider Ownership

94.8% of Skyward Specialty Insurance Group shares are held by institutional investors. Comparatively, 100.0% of RenaissanceRe shares are held by institutional investors. 8.0% of Skyward Specialty Insurance Group shares are held by insiders. Comparatively, 1.3% of RenaissanceRe shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Skyward Specialty Insurance Group and RenaissanceRe’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Skyward Specialty Insurance Group	12.24%	16.39%	3.57%
RenaissanceRe	15.99%	23.41%	4.41%

Risk & Volatility

Skyward Specialty Insurance Group has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500. Comparatively, RenaissanceRe has a beta of 0.38, suggesting that its share price is 62% less volatile than the S&P 500.

Summary

RenaissanceRe beats Skyward Specialty Insurance Group on 8 of the 15 factors compared between the two stocks.

About Skyward Specialty Insurance Group

Skyward Specialty Insurance Group, Inc., an insurance holding company, underwrites commercial property and casualty insurance products in the United States. It offers general liability, excess liability, professional liability, commercial auto, group accident and health, property, surety, and workers' compensation insurance products. Skyward Specialty Insurance Group, Inc. was incorporated in 2006 and is headquartered in Houston, Texas.

About RenaissanceRe

RenaissanceRe Holdings Ltd., together with its subsidiaries, provides reinsurance and insurance products in the United States and internationally. The company operates through Property, and Casualty and Specialty segments. The Property segment writes property catastrophe excess of loss reinsurance and excess of loss reinsurance to insure insurance and reinsurance companies against natural and man-made catastrophes, including hurricanes, earthquakes, typhoons, and tsunamis, as well as winter storms, freezes, floods, fires, windstorms, tornadoes, explosions, and acts of terrorism; and other property class of products, such as proportional reinsurance, property per risk, property reinsurance, binding facilities, and regional U.S. multi-line reinsurance. The Casualty and Specialty segment writes various classes of products, such as directors and officers, medical malpractice, and professional indemnity; automobile and employer’s liability, casualty clash, umbrella or excess casualty, workers’ compensation, and general liability; financial and mortgage guaranty, political risk, surety, and trade credit; and accident and health, agriculture, aviation, cyber, energy, marine, satellite, and terrorism. It distributes products and services primarily through intermediaries. The company invests in and manages funds. RenaissanceRe Holdings Ltd. was founded in 1993 and is headquartered in Pembroke, Bermuda.