Tuesday, 3 May 2016

Analysis of MüRe 2016

MüRe, a German reinsurance company

ISIN DE0008430026 | WKN 843002 

Business: A German reinsurance and insurance company. They have three pillars to stand on: Reinsurance (Covering the risks of other insurance companies), Primary Insurance (classical insurance for private persons or businesses) and finally Health Insurance (In countries with a private system). 

Active: All over the world with Reinsurance. The groups overall strongest presence is in Germany and Europe. 

P/E: 9.3

Here you can find the previous analysis of MüRe 2015

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

The P/E of MüRe is excellent with 9.3 as is the P/B with 1.0 which gives a very clear buy signal from Graham. The earnings to sales are not that great with 5% and neither is the ROE with its 10%. The book to debt ratio is very low, which is bad, with 0.1.
In the last five years they have had a very poor yearly revenue growth rate of 1.2% which gives us a motivated P/E of 8 to 11 which means that MüRe is fairly valued by market today.
They pay an excellent dividend in the size of 4.7% which correspond to 44% of their earnings which is fully acceptable and means that they should be able to keep it up.

Conclusion: Graham says yes to MüRe and now that the low moral CEO Bomhard will be leaving I might stretch myself to also say yes to MüRe... but not until he leaves. The P/E, P/B and dividend are excellent but the ROE is not good. Personally I would not step into MüRe until the share prices crashes again.

If this analysis is outdated then you can request a new one.

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