Sunday, April 19, 2015

Analysis of Allianz 2015


Allianz, a German financial service company

Company: Allianz

ISIN DE0008404005 | WKN 840400  

Business: A German financial service company. They offer six different products / services: Private Insurance (Car, Health, Family House etc.), Business Insurance (large and medium sized companies), Asset Management (fixed income products, stocks and commodities), Global Lines of Business (reinsurance, life insurance and real estate), Assistance Services (automotive, travel, health & life and property) and finally Sustainable Solutions (microinsurance and investments). 

Active: Over 70 countries with 85 million customers.

P/E: 11.9

Here you can find the previous analysis of Allianz 2014

contrarian values of P/E, P/B, ROE as well as dividend for Allianz

The P/E for Allianz is excellent with 11.9 and the P/B is even better with 1.2 which in total gives a clear go from Graham. Earnings to sales are ok with 6% and the ROE is so, so with 10.2%. The book to debt ratio is very low with only 0.08 so even worse than many banks today after they have been forced to improve.
In the last five years they have had a yearly revenue growth of 1.4% which is bad and it gives us a motivated P/E of 9 to 12 which means that Allianz is today fairly valued on the market.
They pay a very nice dividend of 4.3% which correspond to 50% of their earnings (they have recently added that as a dividend payment rule) which for the line of business I find to be ok.

Conclusion: Graham is very happy with Allianz and I also find it to be ok. Even though the share price have increased by around 30% from the last analysis I am less unhappy with the company. I guess that comes from the general environment today and owning shares, for the long run, in Allianz I see little fear in. The P/E, P/B and dividend are all great key figures and the ROE is acceptable. To sum it up I could step in as a shareholder but most likely I will not.

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