Financial Review: Waterdrop (NYSE:WDH) & TWFG (NASDAQ:TWFG)

TWFG (NASDAQ:TWFG) and Waterdrop (NYSE:WDH) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, dividends, valuation, risk, profitability and institutional ownership.

Earnings and Valuation

This table compares TWFG and Waterdrop”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TWFG	$172.93 million	2.86	$26.10 million	N/A	N/A
Waterdrop	$370.53 million	1.11	$23.06 million	$0.09	12.33

TWFG has higher earnings, but lower revenue than Waterdrop.

Analyst Recommendations

This is a summary of recent ratings and target prices for TWFG and Waterdrop, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TWFG	0	3	6	0	2.67
Waterdrop	0	0	0	0	0.00

TWFG currently has a consensus target price of $30.43, suggesting a potential downside of 8.76%. Given TWFG’s stronger consensus rating and higher possible upside, equities research analysts plainly believe TWFG is more favorable than Waterdrop.

Profitability

This table compares TWFG and Waterdrop’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TWFG	N/A	N/A	N/A
Waterdrop	9.71%	5.67%	4.28%

Institutional and Insider Ownership

2.0% of Waterdrop shares are held by institutional investors. 24.6% of Waterdrop shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Waterdrop beats TWFG on 6 of the 11 factors compared between the two stocks.

About TWFG

TWFG, Inc. operates an independent distribution platform for personal and commercial insurance products in the United States. Its personal and commercial insurance products include auto, home, renters, life, health, motorcycle, umbrella, boat, recreational vehicle, flood, wind, event, luxury item, general liability, property, business auto, workers’ compensation, business owner policy, and professional liability insurance products, as well as commercial bonds and group benefits. The company was founded in 2001 and is based in The Woodlands, Texas. TWFG, Inc. operates as a subsidiary of Bunch Family Holdings, LLC.

About Waterdrop

Waterdrop Inc., through its subsidiaries, provides online insurance brokerage services to match and connect users with related insurance products underwritten by insurance companies in the People's Republic of China. The company offers short-term health and long-term health and life insurance products and services. It also operates a medical crowdfunding platform. Waterdrop Inc. was founded in 2016 and is headquartered in Beijing, the People's Republic of China.