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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Reinsurance Group Of America, Incorporated (XNYS:RGA) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
RGA
Name:
REINSURANCE GROUP OF AMERICA, INCORPORATED (XNYS:RGA)
Sector:
157.00M
Industry:
Insurance�Reinsurance
CEO:
Ms. Anna Manning
Total Employees:
3,500
Our Technological Advancement Rating
Our Rating:
-
-
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF REINSURANCE GROUP OF AMERICA, INCORPORATED(RGA) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INSURANCE�REINSURANCE INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
124.54
One Month Price Target:
$125.2
Six Month Price Target :
$128.52
Likely Price in One Year's Time:
Ticker:
$132.49
Likely Trading Range Today Under (Normal Volatility)
$123.87
Price Upper limit ($) :
$125.24
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$116.32
This week:
$106.15
This month :
$87.77
Other Primary facts
Market Cap:
8.36B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
67.01M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
18.68%
-16.54%
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:
$162.72
$145.33
$86.36
$103.75
Medium risk (<10%) entry points
Buy Call
Sell Call
$139.67
Buy Put:
Sell Put:
$135.96
$109.36
$113.12
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
RGA
Sharpe Ratio:
0.09%
Comparison:
RGA, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is 0.00% lower than the industry
& is -95.95% lower than the market/S&P 500 average
Average Returns/Yield of
RGA
Daily returns:
0.01%
Weekly returns:
0.06%
Monthly returns:
0.24%
Yearly returns:
2.84%
Comparison of returns:
Average annual returns/yield (last 3 years) is 0.00% below industry average
Classification:
RGA, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.21
Statistical test of Returns:
RGA has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.22%
Weekly Volatility:
7.20%
Monthly Volatility:
14.40%
Yearly Volatility:
49.89%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.38%
Volatility in last five trading days has been -88.27% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.60%
Weekly VaR:
-14.76%
Monthly VaR:
-29.53%
How Much Can the price of
RGA
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-26%
Worst case (decline):
>85%
This translates to price declining to:
$92.18
This translates to price declining to:
$18.68
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
RGA is a 108.40% riskier investment compared to the market/S&P 500 & is 78.53% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 0.00% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
RGA
Beta in relation to market/S&P 500--0.95
Expected beta in 1 year's time:
0.739
Expected beta in 3 year's time:
1.046
Unlevered (debt free) Beta:
0.693
Beta in relation to Nasdaq (XNAS):
0.847
Beta in relation to all global stocks::
1.025
Beta Comparison & Analysis
Beta of competitors/peers::
0.869
Beta is 9.38% higher than peers
Average Industry Beta:
0.951
Beta is 0.00% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
4.80%
Sustainable growth rate is 0.00% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.068
Alpha is 0.00% below industry average alpha yield
Alpha is -434% below the market average
Analysis of Cost of Capital of
RGA
Equity cost of capital:
0.097
Equity cost of capital is 0.00% below industry mean WACC
Unlevered (without debt) cost of capital:
7.04%
Before-tax cost of debt:
12.54%
After-tax cost of debt:
9.91%
Overall debt rating:
Non-investment grade (junk/speculative grade
Weighted average cost of capital (WACC):
9.91%
WACC is 0.00% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$242.41
Revenue growth rate per share of (3Y):
0.9
FALSE
EPS:
$5.98
Expected Annual growth rate of EPS (3Y):
-13.35%
Expected future EPS growth rate is 0.00% lower than the Insurance�Reinsurance industry
Free cash flow (FCF) per share:
$28.64
Balance sheet equity growth per share: 29.62%
Equity growth rate per share is 0.00% lower than the industry
Debt per share
$54.73
EBITDA per share
$26.53
Valuation Analysis Today of
RGA
P/E Ratio:
31.88
P/E Ratio of Competitors/Peers:
7.01
P/E ratio is 354.41% higher than main peers & is 162.91% higher than the industry
Stock price/value with industry average P/E ratio: $72.50
RGA is 71.77% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $43.22
Present value of the expected future dividends only: $31.77
P/S (Price to Sales ratio):
0.51
Price to sales ratio is 13.42% above the industry mean
P/B (Price to book value ratio):
0.9
Price to free cash flow: 4.35
FALSE
Net income growth rate (3Y):
-19.31%
Net income growth rate is 0.00% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 3.80%
Dividend yeild: 2.34%
Previous Dividend: $0.73
Previous adjusted dividend: $0.73
Previous Dividend: $2.92
Expected next dividend best case: $0.74
Expected next dividend worst case: $0.72
Average dividend payment (long-term): $0.71
Average dividend increase/decrease (growth rate) % per period: 0.43%
Expected next dividend payment date: 29/08/2022
Expected next dividend record date: 15/08/2022
Expected next dividend declaration date: 08/01/2022
Previous dividend payment date: 31/05/2022
Previous dividend record date: 17/05/2022
Previous dividend declaration date: 05/03/2022
Dividend History:
2022-05-16--$0.73
2021-11-15--$0.73
2021-05-17--$0.70
2022-02-14--$0.73
2021-08-16--$0.73
2021-02-17--$0.70
Dividend growth rate is -82.67% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
39.94%
Net debt to equity ratio:
10.43%
Debt to assets ratio:
4.09%
Net debt to assets ratio:
1.07%
Debt-to-asset ratio is -95.24% below industry average
Ability to repay debt:
Interest coverage ratio:
3.87
-
Looking forward:
Debt growth rate:
-2.88%
Annual debt growth is 0% lower than industry average debt growth rate
Debt repayment rate in last quarter: 4.85%
Analysis of Key Statistics
Correlation of price movement with the market:
0.637
Statistical significance of correlation:
RGA has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.637
Stock price is 0.00% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.637
Correlation of price movement with Nasdaq (^IXIC):
0.042
Covariance of price movement with the market:
0.078
Kurtosis
7.967
Returns have a significant 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:
0.247
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
RGA
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
4.25%
Operating profit margin is 13.87% higher than the industry
Net Profit Margin Ratio:
-
Effective Tax Rate:
6.74%
Effective tax rate is -37.05% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
14.03%
Return on equity (ROE) is 192.33% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.43%
Return on assets (ROA) is 114.37% higher than the industry
Financial Leverage:
1.0x
Current Ratio:
0
-
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 4.9 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
4.6M
Each employee generates 0% less revenue than industry average revenue per employee
EBITDA generated per employee:
508.0K
Each employee generates 0% less EBITDA than industry average revenue per employee
Profit generated per employee:
368.0K
Each employee generates 0% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
44.9K
Each employee generates 0% less free cash flow than industry average revenue per employee
Assets/Capital per employee
526.6K
Each employee generates 0% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
RGA
OLD REPUBLIC INTERNATIONAL CORPORATION (XNYS:ORI)
STIFEL FINANCIAL CORP. (XNYS:SF)
RNR-PE
RENAISSANCERE HOLDINGS LTD. (XNYS:RNR)
THE WESTERN UNION COMPANY (XNYS:WU)
VOYA FINANCIAL, INC. (XNYS:VOYA)
HOULIHAN LOKEY, INC. (XNYS:HLI)
RNR-PF
Woori Financial Group Inc. (XNYS:WF)
Current Analyst Ratings
Strong buy�4%
Buy�4%
Hold�25%
Sell�4%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
16.24B
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:
-
-
-
-
-
-
226.00M
226.00M
2.00M
460.00M
-
1.78B
691.00M
1.29B
445.00M
30.00M
1.29B
Statement of Cash Flow
Date:
Period:
-
Differed Income Tax :
-
Stock Based Compensation :
-
Change in Working Capital :
82.00M
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
-
Net Cash Provided by Operating Activities:
163.00M
Investments in PP&E:
- 6000.00K
Net Acquisitions:
-
Purchases of Investments:
- 4762000.00K
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
2.71B
57.92B
60.63B
-
-
-
60.63B
-
-
-
17.98B
1.84B
- 17980000.00K
1.84B
30.97B
89.76B
-
-
-
-
-
-
3.67B
-
3.67B
84.16B
80.49B
1.00M
8.45B
- 55000.0K
790.00M
March 31, 2022 at 6:00:00 AM
11.81B
9.18B
89.67B
75.90B
3.67B
958.0M
2.61B
- 75000.00K
- 2235000.00K
- 187000.00K
-
- 27000.00K
- 49000.00K
2.12B
1.85B
- 21000.00K
- 239000.00K
2.71B
2.95B
163.00M
- 6000.00K
157.00M
Our Proprietary Portfolio Rating
Our Rating:
-
Price Forecast/Expected Price in Next 5 Years of
RGA
2023
2024
2025
2026
2027
$133.19
$141.69
$150.74
$160.37
$170.62