_edited.png)
RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Diamond Hill Investment Group, Inc. (XNAS:DHIL) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
DHIL
Name:
DIAMOND HILL INVESTMENT GROUP, INC. (XNAS:DHIL)
Sector:
- 13701.08K
Industry:
Asset Management
CEO:
Ms. Heather Brilliant
Total Employees:
128
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -109.09% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF DIAMOND HILL INVESTMENT GROUP, INC.(DHIL) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND ASSET MANAGEMENT INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
172.68
One Month Price Target:
$173.67
Six Month Price Target :
$178.6
Likely Price in One Year's Time:
Ticker:
$184.53
Likely Trading Range Today Under (Normal Volatility)
$172.11
Price Upper limit ($) :
$173.45
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$164.66
This week:
$154.74
This month :
$136.81
Other Primary facts
Market Cap:
535.11M
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
3.10M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
9.75%
-14.02%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$209.89
$192.75
$135.47
$152.61
Medium risk (<10%) entry points
Buy Call
Sell Call
$187.17
Buy Put:
Sell Put:
$183.51
$158.14
$161.85
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
DHIL
Sharpe Ratio:
2.13%
Comparison:
DHIL, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 164.95% higher than the industry
& is -6.53% lower than the market/S&P 500 average
Average Returns/Yield of
DHIL
Daily returns:
0.06%
Weekly returns:
0.29%
Monthly returns:
1.15%
Yearly returns:
9.18%
Comparison of returns:
Average annual returns/yield (last 3 years) is 50.62% above industry average
Classification:
DHIL, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.69
Statistical test of Returns:
DHIL has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.29%
Weekly Volatility:
5.12%
Monthly Volatility:
10.24%
Yearly Volatility:
35.47%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.33%
Volatility in last five trading days has been -85.68% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.65%
Weekly VaR:
-10.39%
Monthly VaR:
-20.77%
How Much Can the price of
DHIL
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-18%
Worst case (decline):
-71.96%
This translates to price declining to:
$142.10
This translates to price declining to:
$48.42
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
DHIL is a 46.62% riskier investment compared to the market/S&P 500 & is 25.61% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -11.88% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
DHIL
Beta in relation to market/S&P 500--1.02
Expected beta in 1 year's time:
0.685
Expected beta in 3 year's time:
0.968
Unlevered (debt free) Beta:
0.793
Beta in relation to Nasdaq (XNAS):
0.416
Beta in relation to all global stocks::
0.668
Beta Comparison & Analysis
Beta of competitors/peers::
1.02
Beta is 0.08% higher than peers
Average Industry Beta:
1.694
Beta is -39.74% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
0.037
Alpha is -166.18% below industry average alpha yield
Alpha is 235% higher than market/& is unsustainably high
Analysis of Cost of Capital of
DHIL
Equity cost of capital:
0.101
Equity cost of capital is -31.26% below industry mean WACC
Unlevered (without debt) cost of capital:
7.87%
Before-tax cost of debt:
-
After-tax cost of debt:
-
Overall debt rating:
-
Weighted average cost of capital (WACC):
-
-
Key Per-Share Metrics & Analysis
Revenue per share:
$59.84
Revenue growth rate per share of (3Y):
2.63
Annual revenue growth rate is -66.98% below industry average
EPS:
$21.84
Expected Annual growth rate of EPS (3Y):
11.85%
Expected future EPS growth rate is -57.34% lower than the Asset Management industry
Free cash flow (FCF) per share:
$8.59
Balance sheet equity growth per share: 185.82%
Equity growth rate per share is 779.28% higher than the industry
Debt per share
$0.00
EBITDA per share
$30.78
Valuation Analysis Today of
DHIL
P/E Ratio:
9.61
P/E Ratio of Competitors/Peers:
11.5
P/E ratio is -16.40% lower than main peers & is -40.48% lower than the industry
Stock price/value with industry average P/E ratio: $352.67
DHIL is -51.04% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
2.89
Price to sales ratio is -57.88% below the industry mean
P/B (Price to book value ratio):
2.63
Price to free cash flow: 20.11
Price to free cash flow ratio is 49.42% higher than the industry
Net income growth rate (3Y):
72.37%
Net income growth rate is -50.22% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 6.92%
Dividend yeild: 13.90%
Previous Dividend: $1.50
Previous adjusted dividend: $1.50
Previous Dividend: $24.00
Expected next dividend best case: $9.06
Expected next dividend worst case: -$6.06
Average dividend payment (long-term): $5.88
Average dividend increase/decrease (growth rate) % per period: 249.88%
Expected next dividend payment date: 15/09/2022
Expected next dividend record date: 31/08/2022
-
Previous dividend payment date: 17/06/2022
Previous dividend record date: 06/02/2022
-
Dividend History:
2022-06-01--$1.50
2021-11-26--$20.00
2021-06-02--$1.00
2022-03-04--$1.50
2021-09-08--$1.00
2021-03-10--$1.00
Dividend growth rate is 4425.63% higher than the average industry
In-depth Debt & Leverage Analysis
Debt to equity ratio:
38.89%
Net debt to equity ratio:
-32.19%
Debt to assets ratio:
28.00%
Net debt to assets ratio:
-22.49%
Debt-to-asset ratio is -46.43% below industry average
Ability to repay debt:
Interest coverage ratio:
-
-
Looking forward:
Debt growth rate:
0.00%
-
-
Analysis of Key Statistics
Correlation of price movement with the market:
0.41
Statistical significance of correlation:
DHIL has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.576
Stock price is -28.84% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.576
Correlation of price movement with Nasdaq (^IXIC):
0.008
Covariance of price movement with the market:
0.011
Kurtosis
5.534
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.435
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
DHIL
Gross Profit Margin Ratio:
222%
Operating Profit Margin Ratio:
44.11%
Operating profit margin is -6.22% lower than the industry
Net Profit Margin Ratio:
222%
Effective Tax Rate:
25.90%
Effective tax rate is 6.04% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
38.13%
Return on equity (ROE) is 50.81% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
26.64%
Return on assets (ROA) is 356.49% higher than the industry
Financial Leverage:
1.4x
Current Ratio:
3.45
Current ratio is -9.96% below industry average
Cash Conversion Cycle (days):
41
Cash conversion cycle is -95.29% below industry average
The remaining useful life of property plant & equipment is: 20.4 years
Stock based compensation to net income ratio:
3.35%
In-depth Efficiency Analysis
Revenue generated per employee:
1.4M
Each employee generates 4% more revenue than industry average revenue per employee
EBITDA generated per employee:
745.1K
Each employee generates -198% less EBITDA than industry average revenue per employee
Profit generated per employee:
543.9K
Each employee generates -144% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 107.0K
Each employee generates -11% less free cash flow than industry average revenue per employee
Assets/Capital per employee
1.4M
Each employee generates -11% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
DHIL
TriState Capital Holdings, Inc. (XNAS:TSCAP)
Vector Acquisition Corp II (XNAS:VAQC)
ATLANTICUS HOLDINGS CORPORATION (XNAS:ATLC)
BROWN-FORMAN CORPORATION (XNYS:BF.A)
ATLANTIC CAPITAL BANCSHARES, INC. (XNAS:ACBI)
ARROW FINANCIAL CORPORATION (XNAS:AROW)
RMG ACQUISITION CORP. III (XNAS:RMGC)
First Community Bankshares, Inc. (XNAS:FCBC)
ACTC
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: -
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
185.44M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
81.74M
103.69M
-
14.39M
21.89M
7.50M
-
21.89M
-
-
1.43M
95.37M
81.80M
69.62M
93.92M
24.32M
69.62M
Statement of Cash Flow
Date:
Period:
362.90K
Differed Income Tax :
-
Stock Based Compensation :
2.33M
Change in Working Capital :
- 32648.15K
Accounts Receivables:
- 689.63K
Other Working Capital:
- 26828.74K
Other Non-Cash Items:
8.00M
Net Cash Provided by Operating Activities:
- 13678.17K
Investments in PP&E:
- 22.91K
Net Acquisitions:
-
Purchases of Investments:
- 1684.03K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
58.78M
-
58.78M
21.13M
-
3.16M
83.07M
5.64M
-
-
161.93M
10.72M
-
178.30M
-
261.37M
9.77M
-
4.88M
-
14.28M
24.05M
-
33.97M
33.97M
-
58.02M
83.52M
123.57M
-
- 24476.30K
March 31, 2022 at 6:00:00 AM
103.64M
182.61M
240.63M
-
-
- 58779.3K
3.54M
-
1.83M
-
-
- 9317.66K
- 4818.32K
4.21M
- 9927.12K
-
- 21771.11K
58.78M
80.55M
- 13678.17K
- 22.91K
- 13701.08K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
DHIL
2023
2024
2025
2026
2027
$185.45
$260.98
$278.89
$298.02
$318.47