PRIMERICA INC (PRI) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:PRI - US74164M1080 - Common Stock
256.16 USD
-0.6 (-0.23%)
256.16 USD
0 (0%)
PRI gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 148 industry peers in the Insurance industry. While PRI has a great profitability rating, there are quite some concerns on its financial health. PRI has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- PRI had positive earnings in the past year.
- In the past year PRI had a positive cash flow from operations.
- In the past 5 years PRI has always been profitable.
- PRI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- Looking at the Return On Assets, with a value of 4.84%, PRI belongs to the top of the industry, outperforming 81.76% of the companies in the same industry.
- With an excellent Return On Equity value of 31.31%, PRI belongs to the best of the industry, outperforming 97.30% of the companies in the same industry.
- PRI's Return On Invested Capital of 5.08% is fine compared to the rest of the industry. PRI outperforms 78.38% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for PRI is significantly below the industry average of 14.94%.
- The last Return On Invested Capital (5.08%) for PRI is above the 3 year average (4.51%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.84% | ||
| ROE | 31.31% | ||
| ROIC | 5.08% |
ROA(3y)3.41%
ROA(5y)3.15%
ROE(3y)23.89%
ROE(5y)23.09%
ROIC(3y)4.51%
ROIC(5y)3.99%
1.3 Margins
- With an excellent Profit Margin value of 22.28%, PRI belongs to the best of the industry, outperforming 92.57% of the companies in the same industry.
- In the last couple of years the Profit Margin of PRI has declined.
- With an excellent Operating Margin value of 30.07%, PRI belongs to the best of the industry, outperforming 92.57% of the companies in the same industry.
- In the last couple of years the Operating Margin of PRI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.07% | ||
| PM (TTM) | 22.28% | ||
| GM | N/A |
OM growth 3Y3.67%
OM growth 5Y4.8%
PM growth 3Y-4.72%
PM growth 5Y-3.09%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so PRI is destroying value.
- The number of shares outstanding for PRI has been reduced compared to 1 year ago.
- PRI has less shares outstanding than it did 5 years ago.
- The debt/assets ratio for PRI has been reduced compared to a year ago.
2.2 Solvency
- PRI has a debt to FCF ratio of 2.26. This is a good value and a sign of high solvency as PRI would need 2.26 years to pay back of all of its debts.
- PRI has a Debt to FCF ratio (2.26) which is in line with its industry peers.
- A Debt/Equity ratio of 0.80 indicates that PRI is somewhat dependend on debt financing.
- The Debt to Equity ratio of PRI (0.80) is worse than 86.49% of its industry peers.
- Even though the debt/equity ratio score it not favorable for PRI, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | 2.26 | ||
| Altman-Z | N/A |
ROIC/WACC0.69
WACC7.34%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 17.74% over the past year.
- PRI shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 18.05% yearly.
- PRI shows a small growth in Revenue. In the last year, the Revenue has grown by 5.89%.
- PRI shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.51% yearly.
EPS 1Y (TTM)17.74%
EPS 3Y18.52%
EPS 5Y18.05%
EPS Q2Q%11.44%
Revenue 1Y (TTM)5.89%
Revenue growth 3Y4.46%
Revenue growth 5Y8.51%
Sales Q2Q%12.86%
3.2 Future
- Based on estimates for the next years, PRI will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.13% on average per year.
- PRI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.31% yearly.
EPS Next Y16.78%
EPS Next 2Y11.65%
EPS Next 3Y10.81%
EPS Next 5Y10.13%
Revenue Next Year8.33%
Revenue Next 2Y6.49%
Revenue Next 3Y6.1%
Revenue Next 5Y5.31%
3.3 Evolution
- Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 11.73, the valuation of PRI can be described as reasonable.
- The rest of the industry has a similar Price/Earnings ratio as PRI.
- PRI's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.82.
- PRI is valuated reasonably with a Price/Forward Earnings ratio of 10.63.
- The rest of the industry has a similar Price/Forward Earnings ratio as PRI.
- PRI's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.95.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.73 | ||
| Fwd PE | 10.63 |
4.2 Price Multiples
- PRI's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. PRI is cheaper than 65.54% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of PRI is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.05 | ||
| EV/EBITDA | 7.17 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- The decent profitability rating of PRI may justify a higher PE ratio.
PEG (NY)0.7
PEG (5Y)0.65
EPS Next 2Y11.65%
EPS Next 3Y10.81%
5. Dividend
5.1 Amount
- PRI has a Yearly Dividend Yield of 1.60%. Purely for dividend investing, there may be better candidates out there.
- PRI's Dividend Yield is comparable with the industry average which is at 2.41.
- Compared to an average S&P500 Dividend Yield of 1.82, PRI has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.6% |
5.2 History
- On average, the dividend of PRI grows each year by 19.20%, which is quite nice.
- PRI has been paying a dividend for at least 10 years, so it has a reliable track record.
- PRI has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)19.2%
Div Incr Years14
Div Non Decr Years14
5.3 Sustainability
- PRI pays out 18.50% of its income as dividend. This is a sustainable payout ratio.
- PRI's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP18.5%
EPS Next 2Y11.65%
EPS Next 3Y10.81%
PRIMERICA INC / PRI FAQ
What is the ChartMill fundamental rating of PRIMERICA INC (PRI) stock?
ChartMill assigns a fundamental rating of 5 / 10 to PRI.
What is the valuation status for PRI stock?
ChartMill assigns a valuation rating of 6 / 10 to PRIMERICA INC (PRI). This can be considered as Fairly Valued.
What is the profitability of PRI stock?
PRIMERICA INC (PRI) has a profitability rating of 7 / 10.
What is the valuation of PRIMERICA INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for PRIMERICA INC (PRI) is 11.73 and the Price/Book (PB) ratio is 3.56.
Can you provide the expected EPS growth for PRI stock?
The Earnings per Share (EPS) of PRIMERICA INC (PRI) is expected to grow by 16.78% in the next year.