We assign a fundamental rating of 3 out of 10 to PRU. PRU was compared to 148 industry peers in the Insurance industry. PRU may be in some trouble as it scores bad on both profitability and health. PRU is valued correctly, but it does not seem to be growing. Finally PRU also has an excellent dividend rating.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

PRU had positive earnings in the past year.
PRU had a positive operating cash flow in the past year.
In multiple years PRU reported negative net income over the last 5 years.
PRU had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

PRU's Return On Assets of 0.33% is on the low side compared to the rest of the industry. PRU is outperformed by 81.76% of its industry peers.
PRU has a Return On Equity of 8.05%. This is in the lower half of the industry: PRU underperforms 64.19% of its industry peers.
The Return On Invested Capital of PRU (0.28%) is worse than 71.62% of its industry peers.

		Industry Rank	Sector Rank
ROA	0.33%
ROE	8.05%
ROIC	0.28%

ROA(3y)0.15%

ROA(5y)0.27%

ROE(3y)4.35%

ROE(5y)5.32%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

The Profit Margin of PRU (4.83%) is worse than 67.57% of its industry peers.
PRU's Profit Margin has declined in the last couple of years.
The Operating Margin of PRU (4.87%) is worse than 79.05% of its industry peers.
PRU's Operating Margin has declined in the last couple of years.

		Industry Rank	Sector Rank
OM	4.87%
PM (TTM)	4.83%
GM	N/A

OM growth 3Y-39.41%

OM growth 5Y-14.76%

PM growth 3Y-30.9%

PM growth 5Y-8.56%

GM growth 3YN/A

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

PRU has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, PRU has less shares outstanding
PRU has less shares outstanding than it did 5 years ago.
PRU has a worse debt/assets ratio than last year.

2.2 Solvency

The Debt to FCF ratio of PRU is 4.18, which is a neutral value as it means it would take PRU, 4.18 years of fcf income to pay off all of its debts.
PRU has a worse Debt to FCF ratio (4.18) than 61.49% of its industry peers.
PRU has a Debt/Equity ratio of 0.67. This is a neutral value indicating PRU is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.67, PRU is doing worse than 83.11% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	0.67
Debt/FCF	4.18
Altman-Z	N/A

ROIC/WACC0.03

WACC8.48%

2.3 Liquidity

		Industry Rank	Sector Rank
Current Ratio	N/A
Quick Ratio	N/A

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

PRU shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 12.09%, which is quite good.
PRU shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.07% yearly.
Looking at the last year, PRU shows a very negative growth in Revenue. The Revenue has decreased by -24.65% in the last year.
Measured over the past years, PRU shows a small growth in Revenue. The Revenue has been growing by 0.36% on average per year.

EPS 1Y (TTM)12.09%

EPS 3Y-4.48%

EPS 5Y2.07%

EPS Q2Q%22.41%

Revenue 1Y (TTM)-24.65%

Revenue growth 3Y-2.22%

Revenue growth 5Y0.36%

Sales Q2Q%-16.64%

3.2 Future

Based on estimates for the next years, PRU will show a small growth in Earnings Per Share. The EPS will grow by 0.81% on average per year.
The Revenue is expected to grow by 0.18% on average over the next years.

EPS Next Y13.19%

EPS Next 2Y7.94%

EPS Next 3Y7.22%

EPS Next 5Y0.81%

Revenue Next Year-17.13%

Revenue Next 2Y-8.47%

Revenue Next 3Y-4.55%

Revenue Next 5Y0.18%

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 7.89 indicates a rather cheap valuation of PRU.
75.00% of the companies in the same industry are more expensive than PRU, based on the Price/Earnings ratio.
PRU is valuated cheaply when we compare the Price/Earnings ratio to 28.30, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 7.36, which indicates a rather cheap valuation of PRU.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PRU indicates a somewhat cheap valuation: PRU is cheaper than 75.68% of the companies listed in the same industry.
PRU is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.57, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	7.89
Fwd PE	7.36

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, PRU is valued a bit more expensive than the industry average as 62.16% of the companies are valued more cheaply.
PRU's Price/Free Cash Flow ratio is in line with the industry average.

		Industry Rank	Sector Rank
P/FCF	7.37
EV/EBITDA	14.87

4.3 Compensation for Growth

PRU's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.

PEG (NY)0.6

PEG (5Y)3.81

EPS Next 2Y7.94%

EPS Next 3Y7.22%

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 4.91%, PRU is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 2.23, PRU pays a better dividend. On top of this PRU pays more dividend than 84.46% of the companies listed in the same industry.
PRU's Dividend Yield is rather good when compared to the S&P500 average which is at 1.83.

		Industry Rank	Sector Rank
Dividend Yield	4.91%

5.2 History

The dividend of PRU has a limited annual growth rate of 5.51%.
PRU has been paying a dividend for at least 10 years, so it has a reliable track record.
PRU has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.

Dividend Growth(5Y)5.51%

Div Incr Years16

Div Non Decr Years16

5.3 Sustainability

74.23% of the earnings are spent on dividend by PRU. This is not a sustainable payout ratio.
The dividend of PRU is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.

DP74.23%

EPS Next 2Y7.94%

EPS Next 3Y7.22%

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PRUDENTIAL FINANCIAL INC / PRU FAQ

What is the fundamental rating for PRU stock?

ChartMill assigns a fundamental rating of 3 / 10 to PRU.

What is the valuation status of PRUDENTIAL FINANCIAL INC (PRU) stock?

ChartMill assigns a valuation rating of 6 / 10 to PRUDENTIAL FINANCIAL INC (PRU). This can be considered as Fairly Valued.

Can you provide the profitability details for PRUDENTIAL FINANCIAL INC?

PRUDENTIAL FINANCIAL INC (PRU) has a profitability rating of 2 / 10.

What is the valuation of PRUDENTIAL FINANCIAL INC based on its PE and PB ratios?

The Price/Earnings (PE) ratio for PRUDENTIAL FINANCIAL INC (PRU) is 7.89 and the Price/Book (PB) ratio is 1.21.

How sustainable is the dividend of PRUDENTIAL FINANCIAL INC (PRU) stock?

The dividend rating of PRUDENTIAL FINANCIAL INC (PRU) is 7 / 10 and the dividend payout ratio is 74.23%.