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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
The Hartford Financial Services Group, Inc. (XNYS:HIG) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
HIG
Name:
THE HARTFORD FINANCIAL SERVICES GROUP, INC. (XNYS:HIG)
Sector:
398.00M
Industry:
Insurance�Diversified
CEO:
Mr. Christopher Swift
Total Employees:
18,100
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -82.90% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF THE HARTFORD FINANCIAL SERVICES GROUP, INC.(HIG) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INSURANCE�DIVERSIFIED INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
64.99
One Month Price Target:
$65.32
Six Month Price Target :
$66.97
Likely Price in One Year's Time:
Ticker:
$68.94
Likely Trading Range Today Under (Normal Volatility)
$64.71
Price Upper limit ($) :
$65.34
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$61.2
This week:
$56.52
This month :
$48.04
Other Primary facts
Market Cap:
21.00B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
323.14M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
27.7%
-21.21%
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:
$82.57
$74.51
$47.41
$55.47
Medium risk (<10%) entry points
Buy Call
Sell Call
$71.88
Buy Put:
Sell Put:
$70.16
$58.08
$59.82
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
HIG
Sharpe Ratio:
1.44%
Comparison:
HIG, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -41.04% lower than the industry
& is -36.66% lower than the market/S&P 500 average
Average Returns/Yield of
HIG
Daily returns:
0.05%
Weekly returns:
0.25%
Monthly returns:
1.00%
Yearly returns:
19.61%
Comparison of returns:
Average annual returns/yield (last 3 years) is -38.57% below industry average
Classification:
HIG, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.72
Statistical test of Returns:
HIG has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.86%
Weekly Volatility:
6.40%
Monthly Volatility:
12.81%
Yearly Volatility:
44.36%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.14%
Volatility in last five trading days has been -60.33% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.83%
Weekly VaR:
-13.04%
Monthly VaR:
-26.07%
How Much Can the price of
HIG
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-22%
Worst case (decline):
-90.32%
This translates to price declining to:
$50.38
This translates to price declining to:
$6.29
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
HIG is a 84.03% riskier investment compared to the market/S&P 500 & is 57.66% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -6.64% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
HIG
Beta in relation to market/S&P 500--0.90
Expected beta in 1 year's time:
0.659
Expected beta in 3 year's time:
0.932
Unlevered (debt free) Beta:
0.739
Beta in relation to Nasdaq (XNAS):
0.703
Beta in relation to all global stocks::
0.886
Beta Comparison & Analysis
Beta of competitors/peers::
1.274
Beta is -28.98% lower than peers
Average Industry Beta:
1.088
Beta is -16.88% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
10.33%
Sustainable growth rate is -88.72% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.027
Alpha is -70.03% below industry average alpha yield
Alpha is 172% higher than market/& is unsustainably high
Analysis of Cost of Capital of
HIG
Equity cost of capital:
0.093
Equity cost of capital is -11.86% below industry mean WACC
Unlevered (without debt) cost of capital:
7.64%
Before-tax cost of debt:
4.83%
After-tax cost of debt:
3.82%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.82%
WACC is -2.91% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$66.66
Revenue growth rate per share of (3Y):
1.32
Annual revenue growth rate is -44.05% below industry average
EPS:
$7.27
Expected Annual growth rate of EPS (3Y):
4.99%
Expected future EPS growth rate is -6.84% lower than the Insurance�Diversified industry
Free cash flow (FCF) per share:
$10.68
Balance sheet equity growth per share: 38.45%
Equity growth rate per share is -4.03% lower than the industry
Debt per share
$13.47
EBITDA per share
$13.36
Valuation Analysis Today of
HIG
P/E Ratio:
10.7
P/E Ratio of Competitors/Peers:
8.45
P/E ratio is 26.65% higher than main peers & is -81.90% lower than the industry
Stock price/value with industry average P/E ratio: $429.66
HIG is -84.87% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $40.47
Present value of the expected future dividends only: $22.89
P/S (Price to Sales ratio):
0.97
Price to sales ratio is -65.71% below the industry mean
P/B (Price to book value ratio):
1.32
Price to free cash flow: 6.08
-
Net income growth rate (3Y):
35.73%
Net income growth rate is -100.13% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 0.20%
Dividend yeild: 2.32%
Previous Dividend: $0.39
Previous adjusted dividend: $0.39
Previous Dividend: $1.51
Expected next dividend best case: $0.41
Expected next dividend worst case: $0.36
Average dividend payment (long-term): $0.35
Average dividend increase/decrease (growth rate) % per period: 2.60%
Expected next dividend payment date: 10/03/2022
Expected next dividend record date: 30/08/2022
-
Previous dividend payment date: 07/05/2022
Previous dividend record date: 06/01/2022
-
Dividend History:
2022-05-31--$0.39
2021-11-30--$0.39
2021-05-28--$0.35
2022-02-28--$0.39
2021-08-31--$0.35
2021-02-26--$0.35
Dividend growth rate is -77.35% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
27.39%
Net debt to equity ratio:
29.70%
Debt to assets ratio:
5.79%
Net debt to assets ratio:
6.27%
Debt-to-asset ratio is -93.90% below industry average
Ability to repay debt:
Interest coverage ratio:
18.06
Interest coverage ratio is 943.31% more than industry average
Looking forward:
Debt growth rate:
13.60%
Annual debt growth is -1354% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.584
Statistical significance of correlation:
HIG has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.59
Stock price is -0.98% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.59
Correlation of price movement with Nasdaq (^IXIC):
0.046
Covariance of price movement with the market:
0.077
Kurtosis
24.571
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
0.739
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
HIG
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
0.01%
Operating profit margin is -99.76% lower than the industry
Net Profit Margin Ratio:
-
Effective Tax Rate:
18.34%
Effective tax rate is -14.74% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
16.08%
Return on equity (ROE) is -186.69% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
3.40%
Return on assets (ROA) is 112.21% higher than the industry
Financial Leverage:
1.1x
Current Ratio:
6.84
Current ratio is -70.87% below industry average
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 5.2 years
Stock based compensation to net income ratio:
-1.68%
In-depth Efficiency Analysis
Revenue generated per employee:
1.2M
Each employee generates 14% more revenue than industry average revenue per employee
EBITDA generated per employee:
238.5K
Each employee generates 9% more EBITDA than industry average revenue per employee
Profit generated per employee:
141.2K
Each employee generates 1% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
22.0K
Each employee generates -335% less free cash flow than industry average revenue per employee
Assets/Capital per employee
245.7K
Each employee generates -335% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
HIG
KEYCORP (XNYS:KEY)
Credit Suisse Group Ltd (XNYS:CS)
REGIONS FINANCIAL CORPORATION (XNYS:RF)
CITIZENS FINANCIAL GROUP, INC. (XNYS:CFG)
M&T BANK CORPORATION (XNYS:MTB)
SYNCHRONY FINANCIAL (XNYS:SYF)
RAYMOND JAMES FINANCIAL, INC. (XNYS:RJF)
STT-PG
ROCKET COMPANIES, INC. (XNYS:RKT)
Current Analyst Ratings
Strong buy�4%
Buy�25%
Hold�46%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
21.54B
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:
-
-
-
-
-
-
-
-
-
239.00M
946.00M
4.32B
2.90M
2.56B
3.14B
575.00M
2.56B
Statement of Cash Flow
Date:
Period:
440.00M
Differed Income Tax :
41.00M
Stock Based Compensation :
- 43000.00K
Change in Working Capital :
- 13390000.00K
Accounts Receivables:
-
Other Working Capital:
7.40B
Other Non-Cash Items:
12.94B
Net Cash Provided by Operating Activities:
429.00M
Investments in PP&E:
- 31000.00K
Net Acquisitions:
-
Purchases of Investments:
-
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
223.00M
3.66B
3.88B
4.79B
-
-
8.67B
995.00M
1.91B
835.00M
52.29B
706.00M
- 52292000.00K
4.45B
71.03B
75.25B
677.00M
591.00M
-
-
-
1.27B
4.35B
53.73B
58.09B
-
59.36B
4.00M
16.08B
- 1699000.0K
1.52B
March 31, 2022 at 6:00:00 AM
13.56B
15.90B
75.25B
55.95B
4.95B
4.7B
-
157.00M
126.00M
-
- 43000.00K
- 400000.00K
- 5000.00K
- 138000.00K
- 586000.00K
-
- 31000.00K
306.00M
337.00M
429.00M
- 31000.00K
398.00M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
HIG
2023
2024
2025
2026
2027
$79.62
$84.47
$89.60
$95.05
$100.82