Comparing Arch Capital Group (NASDAQ:ACGL) & GAINSCO (OTCMKTS:GANS)

Arch Capital Group (NASDAQ:ACGL) and GAINSCO (OTCMKTS:GANS) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Institutional and Insider Ownership

89.1% of Arch Capital Group shares are held by institutional investors. 4.2% of Arch Capital Group shares are held by insiders. Comparatively, 73.5% of GAINSCO shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Arch Capital Group and GAINSCO’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arch Capital Group	33.86%	18.94%	5.62%
GAINSCO	N/A	N/A	N/A

Earnings and Valuation

This table compares Arch Capital Group and GAINSCO”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arch Capital Group	$13.63 billion	2.52	$4.44 billion	$14.90	6.13
GAINSCO	N/A	N/A	N/A	N/A	N/A

Arch Capital Group has higher revenue and earnings than GAINSCO.

Analyst Ratings

This is a breakdown of current ratings for Arch Capital Group and GAINSCO, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arch Capital Group	0	5	11	0	2.69
GAINSCO	0	0	0	0	0.00

Arch Capital Group presently has a consensus price target of $118.38, suggesting a potential upside of 29.60%. Given Arch Capital Group’s stronger consensus rating and higher possible upside, analysts plainly believe Arch Capital Group is more favorable than GAINSCO.

Summary

Arch Capital Group beats GAINSCO on 8 of the 9 factors compared between the two stocks.

About Arch Capital Group

Arch Capital Group Ltd., together with its subsidiaries, provides insurance, reinsurance, and mortgage insurance products worldwide. The company's Insurance segment offers primary and excess casualty coverages; loss sensitive primary casualty insurance programs; directors' and officers' liability, errors and omissions liability, employment practices and fiduciary liability, crime, professional indemnity, and other financial related coverages; medical professional and general liability insurance coverages; and workers' compensation and umbrella liability, as well as commercial automobile and inland marine products. It also provides property, energy, marine, and aviation insurance; travel insurance; accident, disability, and medical plan insurance coverages; captive insurance programs; employer's liability; contract and commercial surety coverages; and collateral protection, debt cancellation, and service contract reimbursement products. This segment markets its products through a group of licensed independent retail and wholesale brokers. Its Reinsurance segment provides casualty reinsurance for third party liability exposures; marine and aviation; motor reinsurance, whole account multi-line treaties, cyber, trade credit, surety, accident and health, workers' compensation catastrophe, agriculture, trade credit, and political risk products; reinsurance protection for catastrophic losses, and personal lines and commercial property exposures; life reinsurance; casualty clash; and risk management solutions. This segment markets its reinsurance products through brokers. The company's Mortgage segment offers direct mortgage insurance and mortgage reinsurance. The company was founded in 1995 and is based in Pembroke, Bermuda.

About GAINSCO

GAINSCO, Inc. operates as a property and casualty insurance holding company. The company offers non-standard personal auto products, including coverage for third party liability, bodily injury, and physical damage, as well as collision and coverage for theft, physical damage, and other perils for an insured's vehicle. It is also involved in automotive sales and service, auto racing, and investment activities. The company offers its automobile insurance products under the GAINSCO Auto Insurance brand through independent partner agents and Website comparison shopping places. GAINSCO, Inc. was founded in 1978 and is based in Dallas, Texas.