PRIMERICA INC (PRI) Stock Fundamental Analysis
NYSE:PRI - New York Stock Exchange, Inc. - US74164M1080 - Common Stock - Currency: USD
PRI gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 144 industry peers in the Insurance industry. While PRI belongs to the best of the industry regarding profitability, there are concerns on its financial health. PRI has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
PRI had positive earnings in the past year.
PRI had a positive operating cash flow in the past year.
PRI had positive earnings in each of the past 5 years.
In the past 5 years PRI always reported a positive cash flow from operatings.
1.2 Ratios
PRI's Return On Assets of 4.37% is amongst the best of the industry. PRI outperforms 84.72% of its industry peers.
Looking at the Return On Equity, with a value of 28.24%, PRI belongs to the top of the industry, outperforming 95.14% of the companies in the same industry.
The Return On Invested Capital of PRI (7.74%) is better than 89.58% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PRI is in line with the industry average of 4.07%.
The 3 year average ROIC (4.51%) for PRI is below the current ROIC(7.74%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.37% | ||
| ROE | 28.24% | ||
| ROIC | 7.74% |
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
Looking at the Profit Margin, with a value of 20.10%, PRI belongs to the top of the industry, outperforming 88.19% of the companies in the same industry.
PRI's Profit Margin has declined in the last couple of years.
The Operating Margin of PRI (45.61%) is better than 97.22% of its industry peers.
PRI's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 45.61% | ||
| PM (TTM) | 20.1% | ||
| 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.
The number of shares outstanding for PRI has been reduced compared to 5 years ago.
PRI has a better debt/assets ratio than last year.
2.2 Solvency
The Debt to FCF ratio of PRI is 2.29, which is a good value as it means it would take PRI, 2.29 years of fcf income to pay off all of its debts.
PRI has a Debt to FCF ratio of 2.29. This is comparable to the rest of the industry: PRI outperforms 47.22% of its industry peers.
A Debt/Equity ratio of 0.83 indicates that PRI is somewhat dependend on debt financing.
PRI has a worse Debt to Equity ratio (0.83) than 87.50% 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 | 0.83 | ||
| Debt/FCF | 2.29 | ||
| Altman-Z | N/A |
ROIC/WACC0.89
WACC8.66%
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 impressive 24.41% over the past year.
Measured over the past years, PRI shows a quite strong growth in Earnings Per Share. The EPS has been growing by 18.05% on average per year.
The Revenue has grown by 10.53% in the past year. This is quite good.
The Revenue has been growing by 8.51% on average over the past years. This is quite good.
EPS 1Y (TTM)24.41%
EPS 3Y18.52%
EPS 5Y18.05%
EPS Q2Q%28.39%
Revenue 1Y (TTM)10.53%
Revenue growth 3Y4.46%
Revenue growth 5Y8.51%
Sales Q2Q%8.52%
3.2 Future
PRI is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.49% yearly.
Based on estimates for the next years, PRI will show a small growth in Revenue. The Revenue will grow by 5.19% on average per year.
EPS Next Y9.07%
EPS Next 2Y8.82%
EPS Next 3Y8.74%
EPS Next 5Y9.49%
Revenue Next Year5.9%
Revenue Next 2Y5.24%
Revenue Next 3Y5.16%
Revenue Next 5Y5.19%
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 decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 13.39, the valuation of PRI can be described as correct.
PRI's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of PRI to the average of the S&P500 Index (27.15), we can say PRI is valued rather cheaply.
With a Price/Forward Earnings ratio of 11.96, the valuation of PRI can be described as very reasonable.
PRI's Price/Forward Earnings is on the same level as the industry average.
PRI is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 21.60, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.39 | ||
| Fwd PE | 11.96 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PRI is valued a bit cheaper than the industry average as 77.08% of the companies are valued more expensively.
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 | 10.98 | ||
| EV/EBITDA | 5.69 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PRI has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.48
PEG (5Y)0.74
EPS Next 2Y8.82%
EPS Next 3Y8.74%
5. Dividend
5.1 Amount
PRI has a Yearly Dividend Yield of 1.57%.
Compared to an average industry Dividend Yield of 3.51, PRI has a dividend in line with its industry peers.
PRI's Dividend Yield is slightly below the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.57% |
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 their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)19.2%
Div Incr Years14
Div Non Decr Years14
5.3 Sustainability
PRI pays out 19.03% of its income as dividend. This is a sustainable payout ratio.
The dividend of PRI is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP19.03%
EPS Next 2Y8.82%
EPS Next 3Y8.74%
273.67
+5.14 (+1.91%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners94.29%
Inst Owner Change3.83%
Ins Owners0.56%
Ins Owner Change2.42%
Market Cap8.99B
Analysts69.23
Price Target310.66 (13.52%)
Short Float %3.62%
Short Ratio7.3
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.57% |
Yearly Dividend3.3
Dividend Growth(5Y)19.2%
DP19.03%
Div Incr Years14
Div Non Decr Years14
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.93%
Min EPS beat(2)-0.09%
Max EPS beat(2)3.94%
EPS beat(4)3
Avg EPS beat(4)6.42%
Min EPS beat(4)-0.09%
Max EPS beat(4)17.62%
EPS beat(8)5
Avg EPS beat(8)3.37%
EPS beat(12)7
Avg EPS beat(12)3.35%
EPS beat(16)8
Avg EPS beat(16)1.03%
Revenue beat(2)2
Avg Revenue beat(2)1.5%
Min Revenue beat(2)1.46%
Max Revenue beat(2)1.53%
Revenue beat(4)3
Avg Revenue beat(4)2.01%
Min Revenue beat(4)-1.15%
Max Revenue beat(4)6.21%
Revenue beat(8)4
Avg Revenue beat(8)0.42%
Revenue beat(12)5
Avg Revenue beat(12)7.83%
Revenue beat(16)8
Avg Revenue beat(16)5.95%
PT rev (1m)2.21%
PT rev (3m)-2.87%
EPS NQ rev (1m)-0.19%
EPS NQ rev (3m)-1.33%
EPS NY rev (1m)0.05%
EPS NY rev (3m)-0.49%
Revenue NQ rev (1m)-0.21%
Revenue NQ rev (3m)-0.39%
Revenue NY rev (1m)0.19%
Revenue NY rev (3m)-0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.39 | ||
| Fwd PE | 11.96 | ||
| P/S | 2.84 | ||
| P/FCF | 10.98 | ||
| P/OCF | 10.6 | ||
| P/B | 3.99 | ||
| P/tB | 4.07 | ||
| EV/EBITDA | 5.69 |
EPS(TTM)20.44
EY7.47%
EPS(NY)22.89
Fwd EY8.36%
FCF(TTM)24.93
FCFY9.11%
OCF(TTM)25.83
OCFY9.44%
SpS96.48
BVpS68.67
TBVpS67.29
PEG (NY)1.48
PEG (5Y)0.74
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.37% | ||
| ROE | 28.24% | ||
| ROCE | 10.1% | ||
| ROIC | 7.74% | ||
| ROICexc | 8.09% | ||
| ROICexgc | 9.99% | ||
| OM | 45.61% | ||
| PM (TTM) | 20.1% | ||
| GM | N/A | ||
| FCFM | 25.84% |
ROA(3y)3.41%
ROA(5y)3.15%
ROE(3y)23.89%
ROE(5y)23.09%
ROIC(3y)4.51%
ROIC(5y)3.99%
ROICexc(3y)4.7%
ROICexc(5y)4.15%
ROICexgc(3y)5.93%
ROICexgc(5y)5.27%
ROCE(3y)5.88%
ROCE(5y)5.21%
ROICexcg growth 3Y11.32%
ROICexcg growth 5Y12.44%
ROICexc growth 3Y13.03%
ROICexc growth 5Y13.1%
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
F-Score8
Asset Turnover0.22
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.83 | ||
| Debt/FCF | 2.29 | ||
| Debt/EBITDA | 1.06 | ||
| Cap/Depr | 9.08% | ||
| Cap/Sales | 0.93% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 47.9% | ||
| Profit Quality | 128.54% | ||
| Current Ratio | N/A | ||
| Quick Ratio | N/A | ||
| Altman-Z | N/A |
F-Score8
WACC8.66%
ROIC/WACC0.89
Cap/Depr(3y)8.9%
Cap/Depr(5y)9.38%
Cap/Sales(3y)1.03%
Cap/Sales(5y)1.05%
Profit Quality(3y)149.37%
Profit Quality(5y)148.26%
High Growth Momentum
Growth
EPS 1Y (TTM)24.41%
EPS 3Y18.52%
EPS 5Y18.05%
EPS Q2Q%28.39%
EPS Next Y9.07%
EPS Next 2Y8.82%
EPS Next 3Y8.74%
EPS Next 5Y9.49%
Revenue 1Y (TTM)10.53%
Revenue growth 3Y4.46%
Revenue growth 5Y8.51%
Sales Q2Q%8.52%
Revenue Next Year5.9%
Revenue Next 2Y5.24%
Revenue Next 3Y5.16%
Revenue Next 5Y5.19%
EBIT growth 1Y82.89%
EBIT growth 3Y8.3%
EBIT growth 5Y13.71%
EBIT Next Year-9.11%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y18.14%
FCF growth 3Y9.62%
FCF growth 5Y11.4%
OCF growth 1Y17.98%
OCF growth 3Y9.48%
OCF growth 5Y12.17%