AMERICAN FINANCIAL GROUP INC (AFG) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:AFG - US0259321042 - Common Stock
138.16 USD
+0.07 (+0.05%)
138.16 USD
0 (0%)
Taking everything into account, AFG scores 5 out of 10 in our fundamental rating. AFG was compared to 148 industry peers in the Insurance industry. AFG is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. While showing a medium growth rate, AFG is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year AFG was profitable.
In the past year AFG had a positive cash flow from operations.
Each year in the past 5 years AFG has been profitable.
Each year in the past 5 years AFG had a positive operating cash flow.
1.2 Ratios
AFG's Return On Assets of 2.36% is in line compared to the rest of the industry. AFG outperforms 54.05% of its industry peers.
Looking at the Return On Equity, with a value of 16.87%, AFG is in the better half of the industry, outperforming 73.65% of the companies in the same industry.
With a Return On Invested Capital value of 2.38%, AFG perfoms like the industry average, outperforming 50.68% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for AFG is significantly below the industry average of 14.88%.
| 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 of 9.70%. This is comparable to the rest of the industry: AFG outperforms 56.76% of 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 47.30% of its industry peers.
In the last couple of years the Operating Margin of AFG has declined.
| 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.
The number of shares outstanding for AFG has been increased compared to 1 year ago.
AFG has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, AFG has an improved debt to assets ratio.
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.
AFG has a Altman-Z score of 0.78. This is in the better half of the industry: AFG outperforms 77.03% of its industry peers.
AFG has a debt to FCF ratio of 1.41. This is a very positive value and a sign of high solvency as it would only need 1.41 years to pay back of all of its debts.
With a Debt to FCF ratio value of 1.41, AFG perfoms like the industry average, outperforming 57.43% of the companies in the same industry.
AFG has a Debt/Equity ratio of 0.38. This is a healthy value indicating a solid balance between debt and equity.
AFG has a worse Debt to Equity ratio (0.38) than 61.49% of its industry peers.
Although AFG does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 1.41 | ||
| Altman-Z | 0.78 |
ROIC/WACC0.29
WACC8.23%
2.3 Liquidity
A Current Ratio of 9.26 indicates that AFG has no problem at all paying 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.
AFG has a Quick ratio of 9.26. This is amongst the best in the industry. AFG outperforms 96.62% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 9.26 | ||
| Quick Ratio | 9.26 |
3. Growth
3.1 Past
The earnings per share for AFG have decreased by -6.78% in the last year.
Measured over the past 5 years, AFG shows a small growth in Earnings Per Share. The EPS has been growing by 4.54% on average per year.
AFG shows a small growth in Revenue. In the last year, the Revenue has grown by 0.13%.
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 4.53% on average over the next years.
The Revenue is expected to grow by 3.20% on average over the next years.
EPS Next Y-6.66%
EPS Next 2Y3.48%
EPS Next 3Y4.53%
EPS Next 5YN/A
Revenue Next Year0.48%
Revenue Next 2Y2.71%
Revenue Next 3Y3.2%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 14.16, AFG is valued correctly.
AFG's Price/Earnings is on the same level as the industry average.
AFG's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.57.
With a Price/Forward Earnings ratio of 12.00, AFG is valued correctly.
AFG's Price/Forward Earnings is on the same level as the industry average.
AFG is valuated cheaply when we compare the Price/Forward Earnings ratio to 24.04, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.16 | ||
| Fwd PE | 12 |
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.
The rest of the industry has a similar Price/Free Cash Flow ratio as AFG.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.93 | ||
| EV/EBITDA | 10.5 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)3.12
EPS Next 2Y3.48%
EPS Next 3Y4.53%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 6.63%, AFG is a good candidate for dividend investing.
AFG's Dividend Yield is rather good when compared to the industry average which is at 2.42. AFG pays more dividend than 91.22% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.00, AFG pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.63% |
5.2 History
The dividend of AFG is nicely growing with an annual growth rate of 13.64%!
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
AFG pays out 96.49% of its income as dividend. This is not a sustainable payout ratio.
AFG's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP96.49%
EPS Next 2Y3.48%
EPS Next 3Y4.53%
138.16
+0.07 (+0.05%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners68.31%
Inst Owner Change0.58%
Ins Owners17.96%
Ins Owner Change-0.35%
Market Cap11.52B
Revenue(TTM)8.23B
Net Income(TTM)798.00M
Analysts72
Price Target143.41 (3.8%)
Short Float %1.83%
Short Ratio2.74
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.63% |
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)0.29%
PT rev (3m)6.03%
EPS NQ rev (1m)0%
EPS NQ rev (3m)1.65%
EPS NY rev (1m)2.6%
EPS NY rev (3m)5.15%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.61%
Revenue NY rev (1m)-0.27%
Revenue NY rev (3m)-0.27%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.16 | ||
| Fwd PE | 12 | ||
| P/S | 1.4 | ||
| P/FCF | 8.93 | ||
| P/OCF | 8.1 | ||
| P/B | 2.44 | ||
| P/tB | 2.74 | ||
| EV/EBITDA | 10.5 |
EPS(TTM)9.76
EY7.06%
EPS(NY)11.51
Fwd EY8.33%
FCF(TTM)15.48
FCFY11.2%
OCF(TTM)17.06
OCFY12.35%
SpS98.63
BVpS56.71
TBVpS50.49
PEG (NY)N/A
PEG (5Y)3.12
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
WACC8.23%
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-6.66%
EPS Next 2Y3.48%
EPS Next 3Y4.53%
EPS Next 5YN/A
Revenue 1Y (TTM)0.13%
Revenue growth 3Y8.33%
Revenue growth 5Y0.16%
Sales Q2Q%-2.04%
Revenue Next Year0.48%
Revenue Next 2Y2.71%
Revenue Next 3Y3.2%
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 3 / 10 to AMERICAN FINANCIAL GROUP INC (AFG). This can be considered as Overvalued.
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 14.16 and the Price/Book (PB) ratio is 2.44.
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 -6.66% in the next year.