Allstate vs Globe Life Which Is a Smarter Choice?

Allstate Corporation and Globe Life Inc. are two prominent insurance companies that offer a range of products and services. Allstate is known for its comprehensive property and casualty insurance offerings, while Globe Life specializes in life and supplemental health insurance. Investors often compare the stocks of these companies to determine which one offers better growth potential and dividend payouts. Both companies have strong financial performance and stable track records, making them attractive options for investors looking to diversify their portfolios in the insurance sector.

Allstate or Globe Life?

When comparing Allstate and Globe Life, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Allstate and Globe Life.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Allstate has a dividend yield of 1.85%, while Globe Life has a dividend yield of 0.65%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Allstate reports a 5-year dividend growth of 14.11% year and a payout ratio of 25.45%. On the other hand, Globe Life reports a 5-year dividend growth of 6.97% year and a payout ratio of 7.93%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Allstate P/E ratio at 12.35 and Globe Life's P/E ratio at 8.87. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Allstate P/B ratio is 2.50 while Globe Life's P/B ratio is 2.08.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Allstate has seen a 5-year revenue growth of 0.90%, while Globe Life's is 0.50%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Allstate's ROE at 22.29% and Globe Life's ROE at 22.49%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $196.99 for Allstate and $108.75 for Globe Life. Over the past year, Allstate's prices ranged from $130.77 to $201.00, with a yearly change of 53.70%. Globe Life's prices fluctuated between $38.95 and $132.00, with a yearly change of 238.90%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.