AEGON (NYSE:AEG) and China Life Insurance (NYSE:LFC) are both large-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, risk, earnings, dividends, valuation, analyst recommendations and institutional ownership.
Earnings and Valuation
This table compares AEGON and China Life Insurance’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|AEGON||$38.94 billion||0.35||$838.51 million||$0.90||5.61|
|China Life Insurance||$91.03 billion||0.82||$1.72 billion||$0.28||47.04|
AEGON pays an annual dividend of $0.28 per share and has a dividend yield of 5.5%. China Life Insurance pays an annual dividend of $0.09 per share and has a dividend yield of 0.7%. AEGON pays out 31.1% of its earnings in the form of a dividend. China Life Insurance pays out 32.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. AEGON has raised its dividend for 3 consecutive years. AEGON is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Institutional and Insider Ownership
6.1% of AEGON shares are held by institutional investors. Comparatively, 0.3% of China Life Insurance shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares AEGON and China Life Insurance’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|China Life Insurance||3.60%||7.04%||0.75%|
This is a summary of recent recommendations and price targets for AEGON and China Life Insurance, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|China Life Insurance||0||5||4||0||2.44|
AEGON presently has a consensus target price of $5.00, suggesting a potential downside of 0.99%. Given AEGON’s stronger consensus rating and higher possible upside, research analysts clearly believe AEGON is more favorable than China Life Insurance.
Risk & Volatility
AEGON has a beta of 1.21, meaning that its share price is 21% more volatile than the S&P 500. Comparatively, China Life Insurance has a beta of 1.44, meaning that its share price is 44% more volatile than the S&P 500.
China Life Insurance beats AEGON on 9 of the 16 factors compared between the two stocks.
Aegon N.V. provides insurance, pensions, and asset management services worldwide. It offers life, accident, and health insurance; property and casualty insurance; home and car insurance; individual investment accounts; annuities; retirement plan services; stable value solutions; retail and institutional investment management solutions; savings products; group pensions; mortgage loans; and bank accounts. The company markets its products through brokers, independent agents, employee benefit consultants, bancassurance channels, self-service/online centers, and call/advice centers. Aegon N.V. was founded in 1983 and is headquartered in The Hague, the Netherlands.
About China Life Insurance
China Life Insurance Company Limited, together with its subsidiaries, operates as a life insurance company in the People's Republic of China. It operates in four segments: Life Insurance Business, Health Insurance Business, Accident Insurance Business, and Other Businesses. The company offers individual and group life, annuity, accident, and health insurance products, as well as pension products. It is also involved in the asset management, annuity, retirement properties investment, fund management, financial service, health management, investment, investment management, and reinsurance businesses. China Life Insurance Company Limited sells its products through agents, direct sales representatives, and dedicated and non-dedicated agencies. The company was founded in 1949 and is headquartered in Beijing, the People's Republic of China. China Life Insurance Company Limited is a subsidiary of China Life Insurance (Group) Company Limited.
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