AMERICAN FINANCIAL GROUP INC (AFG) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:AFG - US0259321042 - Common Stock
137.72 USD
+0.46 (+0.34%)
137.72 USD
0 (0%)
AFG gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 148 industry peers in the Insurance industry. While AFG has a great health rating, its profitability is only average at the moment. AFG is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year AFG was profitable.
AFG had a positive operating cash flow in the past year.
In the past 5 years AFG has always been profitable.
Each year in the past 5 years AFG had a positive operating cash flow.
1.2 Ratios
The Return On Assets of AFG (2.36%) is comparable to the rest of the industry.
The Return On Equity of AFG (16.87%) is better than 72.30% of its industry peers.
AFG has a Return On Invested Capital of 2.38%. This is comparable to the rest of the industry: AFG outperforms 51.35% of its industry peers.
AFG had an Average Return On Invested Capital over the past 3 years of 2.95%. This is in line with the industry average of 4.56%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.36% | ||
| ROE | 16.87% | ||
| ROIC | 2.38% |
ROA(3y)2.95%
ROA(5y)3.35%
ROE(3y)20.68%
ROE(5y)22.52%
ROIC(3y)2.95%
ROIC(5y)2.64%
1.3 Margins
AFG has a Profit Margin (9.70%) which is in line with its industry peers.
AFG's Profit Margin has been stable in the last couple of years.
AFG's Operating Margin of 12.28% is in line compared to the rest of the industry. AFG outperforms 47.97% of its industry peers.
AFG's Operating Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.28% | ||
| PM (TTM) | 9.7% | ||
| GM | N/A |
OM growth 3Y-15.95%
OM growth 5Y-2.25%
PM growth 3Y-29.55%
PM growth 5Y-0.39%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
AFG has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
AFG has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, AFG has less shares outstanding
The debt/assets ratio for AFG has been reduced compared to a year ago.
2.2 Solvency
AFG has an Altman-Z score of 0.78. This is a bad value and indicates that AFG is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of AFG (0.78) is better than 75.68% of its industry peers.
The Debt to FCF ratio of AFG is 1.41, which is an excellent value as it means it would take AFG, only 1.41 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.41, AFG is in line with its industry, outperforming 57.43% of the companies in the same industry.
A Debt/Equity ratio of 0.38 indicates that AFG is not too dependend on debt financing.
AFG has a worse Debt to Equity ratio (0.38) than 61.49% of its industry peers.
Even though the debt/equity ratio score it not favorable for AFG, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 1.41 | ||
| Altman-Z | 0.78 |
ROIC/WACC0.29
WACC8.13%
2.3 Liquidity
AFG has a Current Ratio of 9.26. This indicates that AFG is financially healthy and has no problem in meeting its short term obligations.
AFG has a Current ratio of 9.26. This is amongst the best in the industry. AFG outperforms 96.62% of its industry peers.
AFG has a Quick Ratio of 9.26. This indicates that AFG is financially healthy and has no problem in meeting its short term obligations.
With an excellent Quick ratio value of 9.26, AFG belongs to the best of the industry, outperforming 96.62% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 9.26 | ||
| Quick Ratio | 9.26 |
3. Growth
3.1 Past
AFG shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -6.78%.
The Earnings Per Share has been growing slightly by 4.54% on average over the past years.
Looking at the last year, AFG shows a small growth in Revenue. The Revenue has grown by 0.13% in the last year.
Measured over the past years, AFG shows a small growth in Revenue. The Revenue has been growing by 0.16% on average per year.
EPS 1Y (TTM)-6.78%
EPS 3Y-2.5%
EPS 5Y4.54%
EPS Q2Q%16.45%
Revenue 1Y (TTM)0.13%
Revenue growth 3Y8.33%
Revenue growth 5Y0.16%
Sales Q2Q%-2.04%
3.2 Future
The Earnings Per Share is expected to grow by 4.58% on average over the next years.
AFG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.31% yearly.
EPS Next Y-9.02%
EPS Next 2Y4.04%
EPS Next 3Y4.58%
EPS Next 5YN/A
Revenue Next Year0.75%
Revenue Next 2Y3.94%
Revenue Next 3Y3.31%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 14.11 indicates a correct valuation of AFG.
The rest of the industry has a similar Price/Earnings ratio as AFG.
The average S&P500 Price/Earnings ratio is at 26.31. AFG is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 11.83 indicates a reasonable valuation of AFG.
AFG's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 36.59. AFG is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.11 | ||
| Fwd PE | 11.83 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of AFG is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of AFG is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.9 | ||
| EV/EBITDA | 10.47 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)3.11
EPS Next 2Y4.04%
EPS Next 3Y4.58%
5. Dividend
5.1 Amount
AFG has a Yearly Dividend Yield of 2.56%.
AFG's Dividend Yield is a higher than the industry average which is at 3.33.
Compared to an average S&P500 Dividend Yield of 2.34, AFG has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.56% |
5.2 History
On average, the dividend of AFG grows each year by 13.64%, which is quite nice.
AFG has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of AFG decreased recently.
Dividend Growth(5Y)13.64%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
96.49% of the earnings are spent on dividend by AFG. This is not a sustainable payout ratio.
The dividend of AFG is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP96.49%
EPS Next 2Y4.04%
EPS Next 3Y4.58%
137.72
+0.46 (+0.34%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners67.24%
Inst Owner Change0.55%
Ins Owners17.97%
Ins Owner Change0.92%
Market Cap11.49B
Revenue(TTM)8.23B
Net Income(TTM)798.00M
Analysts72
Price Target143 (3.83%)
Short Float %1.71%
Short Ratio2.32
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.56% |
Yearly Dividend9.4
Dividend Growth(5Y)13.64%
DP96.49%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.9%
Min EPS beat(2)1.66%
Max EPS beat(2)6.15%
EPS beat(4)2
Avg EPS beat(4)-1.05%
Min EPS beat(4)-11.61%
Max EPS beat(4)6.15%
EPS beat(8)4
Avg EPS beat(8)-1.25%
EPS beat(12)5
Avg EPS beat(12)-2.16%
EPS beat(16)9
Avg EPS beat(16)4.6%
Revenue beat(2)0
Avg Revenue beat(2)-3.89%
Min Revenue beat(2)-7.78%
Max Revenue beat(2)0%
Revenue beat(4)1
Avg Revenue beat(4)-2.85%
Min Revenue beat(4)-10.18%
Max Revenue beat(4)6.57%
Revenue beat(8)3
Avg Revenue beat(8)-1.94%
Revenue beat(12)5
Avg Revenue beat(12)0.24%
Revenue beat(16)9
Avg Revenue beat(16)4.53%
PT rev (1m)5.73%
PT rev (3m)7.35%
EPS NQ rev (1m)2.26%
EPS NQ rev (3m)1.9%
EPS NY rev (1m)0%
EPS NY rev (3m)2.94%
Revenue NQ rev (1m)-2.61%
Revenue NQ rev (3m)-4.35%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.42%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.11 | ||
| Fwd PE | 11.83 | ||
| P/S | 1.4 | ||
| P/FCF | 8.9 | ||
| P/OCF | 8.07 | ||
| P/B | 2.43 | ||
| P/tB | 2.73 | ||
| EV/EBITDA | 10.47 |
EPS(TTM)9.76
EY7.09%
EPS(NY)11.64
Fwd EY8.45%
FCF(TTM)15.48
FCFY11.24%
OCF(TTM)17.06
OCFY12.39%
SpS98.63
BVpS56.71
TBVpS50.49
PEG (NY)N/A
PEG (5Y)3.11
Graham Number111.6
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.36% | ||
| ROE | 16.87% | ||
| ROCE | 3.01% | ||
| ROIC | 2.38% | ||
| ROICexc | 2.52% | ||
| ROICexgc | 2.77% | ||
| OM | 12.28% | ||
| PM (TTM) | 9.7% | ||
| GM | N/A | ||
| FCFM | 15.69% |
ROA(3y)2.95%
ROA(5y)3.35%
ROE(3y)20.68%
ROE(5y)22.52%
ROIC(3y)2.95%
ROIC(5y)2.64%
ROICexc(3y)3.07%
ROICexc(5y)2.78%
ROICexgc(3y)3.35%
ROICexgc(5y)3.01%
ROCE(3y)3.73%
ROCE(5y)3.34%
ROICexgc growth 3Y-11.18%
ROICexgc growth 5Y16.37%
ROICexc growth 3Y-11.66%
ROICexc growth 5Y15.82%
OM growth 3Y-15.95%
OM growth 5Y-2.25%
PM growth 3Y-29.55%
PM growth 5Y-0.39%
GM growth 3YN/A
GM growth 5YN/A
F-Score5
Asset Turnover0.24
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 1.41 | ||
| Debt/EBITDA | 1.66 | ||
| Cap/Depr | 155.29% | ||
| Cap/Sales | 1.6% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 129.95% | ||
| Profit Quality | 161.78% | ||
| Current Ratio | 9.26 | ||
| Quick Ratio | 9.26 | ||
| Altman-Z | 0.78 |
F-Score5
WACC8.13%
ROIC/WACC0.29
Cap/Depr(3y)114.17%
Cap/Depr(5y)79.15%
Cap/Sales(3y)1.25%
Cap/Sales(5y)1.15%
Profit Quality(3y)152.16%
Profit Quality(5y)165.86%
High Growth Momentum
Growth
EPS 1Y (TTM)-6.78%
EPS 3Y-2.5%
EPS 5Y4.54%
EPS Q2Q%16.45%
EPS Next Y-9.02%
EPS Next 2Y4.04%
EPS Next 3Y4.58%
EPS Next 5YN/A
Revenue 1Y (TTM)0.13%
Revenue growth 3Y8.33%
Revenue growth 5Y0.16%
Sales Q2Q%-2.04%
Revenue Next Year0.75%
Revenue Next 2Y3.94%
Revenue Next 3Y3.31%
Revenue Next 5YN/A
EBIT growth 1Y-7.08%
EBIT growth 3Y-8.95%
EBIT growth 5Y-2.09%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y1.65%
FCF growth 3Y-14.88%
FCF growth 5Y-15.83%
OCF growth 1Y7.48%
OCF growth 3Y-12.4%
OCF growth 5Y-14.05%
AMERICAN FINANCIAL GROUP INC / AFG FAQ
What is the ChartMill fundamental rating of AMERICAN FINANCIAL GROUP INC (AFG) stock?
ChartMill assigns a fundamental rating of 5 / 10 to AFG.
Can you provide the valuation status for AMERICAN FINANCIAL GROUP INC?
ChartMill assigns a valuation rating of 4 / 10 to AMERICAN FINANCIAL GROUP INC (AFG). This can be considered as Fairly Valued.
How profitable is AMERICAN FINANCIAL GROUP INC (AFG) stock?
AMERICAN FINANCIAL GROUP INC (AFG) has a profitability rating of 4 / 10.
Can you provide the PE and PB ratios for AFG stock?
The Price/Earnings (PE) ratio for AMERICAN FINANCIAL GROUP INC (AFG) is 14.11 and the Price/Book (PB) ratio is 2.43.
Can you provide the expected EPS growth for AFG stock?
The Earnings per Share (EPS) of AMERICAN FINANCIAL GROUP INC (AFG) is expected to decline by -9.02% in the next year.