CNO Financial Group (NYSE:CNO) and Lincoln National (NYSE:LNC) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, risk, valuation, institutional ownership, profitability and dividends.
Volatility and Risk
CNO Financial Group has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500. Comparatively, Lincoln National has a beta of 2.26, indicating that its stock price is 126% more volatile than the S&P 500.
Valuation and Earnings
This table compares CNO Financial Group and Lincoln National's top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| CNO Financial Group | $4.02 billion | 0.89 | $409.40 million | $1.80 | 14.93 |
| Lincoln National | $17.26 billion | 0.77 | $886 million | $8.70 | 7.97 |
Lincoln National has higher revenue and earnings than CNO Financial Group. Lincoln National is trading at a lower price-to-earnings ratio than CNO Financial Group, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of recent ratings for CNO Financial Group and Lincoln National, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| CNO Financial Group | 0 | 2 | 2 | 0 | 2.50 |
| Lincoln National | 1 | 7 | 4 | 0 | 2.25 |
CNO Financial Group presently has a consensus price target of $25.20, indicating a potential downside of 6.25%. Lincoln National has a consensus price target of $59.3846, indicating a potential downside of 14.31%. Given CNO Financial Group's stronger consensus rating and higher probable upside, research analysts clearly believe CNO Financial Group is more favorable than Lincoln National.
Dividends
CNO Financial Group pays an annual dividend of $0.48 per share and has a dividend yield of 1.8%. Lincoln National pays an annual dividend of $1.68 per share and has a dividend yield of 2.4%. CNO Financial Group pays out 26.7% of its earnings in the form of a dividend. Lincoln National pays out 19.3% 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. CNO Financial Group has raised its dividend for 6 consecutive years and Lincoln National has raised its dividend for 1 consecutive years. Lincoln National is clearly the better dividend stock, given its higher yield and lower payout ratio.
Institutional and Insider Ownership
98.1% of CNO Financial Group shares are held by institutional investors. Comparatively, 76.7% of Lincoln National shares are held by institutional investors. 2.0% of CNO Financial Group shares are held by insiders. Comparatively, 1.5% of Lincoln National shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Profitability
This table compares CNO Financial Group and Lincoln National's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| CNO Financial Group | 12.27% | 7.21% | 0.98% |
| Lincoln National | 4.28% | 5.09% | 0.30% |
Summary
CNO Financial Group beats Lincoln National on 9 of the 17 factors compared between the two stocks.
