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Assurant (AIZ)
:AIZ
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Assurant
(NYSE:AIZ)
80Outperform
Positive Factors
Growth Prospects
Management is anticipating strong growth in Global Housing aside from the tough comparison against $107 million of prior year reserve development.
Shareholder Returns
Share repurchases are expected to be $200-$300 million, consistent with the company's initial guidance.
Negative Factors
Foreign Exchange Impact
Foreign exchange is expected to be a couple of points headwind to EPS growth in the coming year.
Assurant (AIZ) vs. S&P 500 (SPY)
Market Cap
$10.36B
Dividend Yield1.48%
Average Volume (3M)514.14K
Price to Earnings (P/E)14.2
Beta (1Y)0.66
Revenue Growth6.70%
EPS Growth21.03%
CountryUS
Employees14,200
SectorFinancial
Sector Strength81
IndustryInsurance
Share Statistics
EPS (TTM)14.47
Shares Outstanding50,791,920
10 Day Avg. Volume550,310
30 Day Avg. Volume514,139
Financial Highlights & Ratios
PEG Ratio0.68
Price to Book (P/B)N/A
Price to Sales (P/S)0.88
Price to Cash Flow (P/CF)25.40
P/FCF Ratio21.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$230.75Price Target Upside13.08% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
Assurant Business Overview & Revenue Model
Company DescriptionAssurant, Inc. (AIZ) is a global provider of risk management solutions, primarily focusing on the housing and lifestyle markets. The company offers a wide range of products and services, including mobile device protection, extended service contracts, vehicle protection services, pre-funded funeral insurance, renters insurance, and lender-placed homeowners insurance. With a presence in over 20 countries, Assurant is dedicated to protecting consumer purchases and supporting major consumer electronics and vehicle manufacturers, financial institutions, retailers, and mobile carriers.
How the Company Makes MoneyAssurant makes money through a diversified revenue model based on premiums, fees, and commissions associated with its insurance products and services. The company earns significant revenue from its mobile and extended service contract businesses by partnering with major retailers and mobile network operators to provide protection plans for consumer electronics and appliances. Additionally, Assurant generates income from its vehicle protection services by collaborating with automotive manufacturers, dealers, and financial institutions to offer vehicle service contracts and related products. The company's housing sector revenue primarily comes from lender-placed insurance, which is placed on properties when homeowners' own policies lapse. Assurant's ability to leverage strategic partnerships and maintain strong relationships with global brands contributes significantly to its earnings.
Assurant Financial Statement Overview
Summary
Assurant exhibits a strong financial profile with notable improvements in revenue, profitability, and cash flow generation. The company has effectively enhanced operational efficiency and reduced debt, bolstering its financial stability. However, further improvement in cash retention and managing leverage risks remains important.Income Statement
Assurant's income statement shows strong revenue growth with a 6.7% increase from 2023 to 2024. Gross profit margins remain robust at 100%, indicating efficient cost management. The EBIT margin improved significantly to 32% in 2024 from 5.8% in 2023, showing enhanced operational efficiency. However, the absence of EBITDA data in 2024 limits a full analysis of earnings before interest, taxes, depreciation, and amortization.85
Very Positive
Balance Sheet
The balance sheet reflects a strong financial position with a debt-free status in 2024 and a solid equity base. The equity ratio improved to 14.6% in 2024, up from 14.3% in 2023, showing a stable capital structure. Return on equity increased to 14.9% in 2024, indicating effective utilization of equity in generating profits. However, the relatively low equity ratio compared to total assets suggests potential leverage risk.78
Positive
Cash Flow
Cash flow analysis demonstrates a healthy free cash flow generation, with a 42.5% growth rate from 2023 to 2024. The operating cash flow to net income ratio of 1.8 in 2024 highlights effective cash conversion from profit. However, the free cash flow to net income ratio is slightly lower at 1.8, indicating potential for improvement in cash retention relative to income.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 11.88B | 11.13B | 10.19B | 10.19B | 9.59B | Gross Profit |
| 11.88B | 11.13B | 10.19B | 10.19B | 9.59B | EBIT |
| 3.80B | 642.50M | 458.20M | 1.54B | 502.20M | EBITDA |
| 0.00 | 1.12B | 639.00M | 1.05B | 20.00B | Net Income Common Stockholders |
| 760.20M | 642.50M | 276.60M | 613.50M | 440.80M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 8.98B | 8.54B | 7.98B | 9.50B | 16.01B | Total Assets |
| 35.02B | 33.64B | 33.12B | 33.91B | 44.65B | Total Debt |
| 2.08B | 2.08B | 2.13B | 2.20B | 2.25B | Net Debt |
| 275.40M | 453.00M | 593.20M | 161.70M | 24.30M | Total Liabilities |
| 29.91B | 28.83B | 28.90B | 28.42B | 38.70B | Stockholders Equity |
| 5.11B | 4.81B | 4.23B | 5.49B | 5.95B |
| Cash Flow | Free Cash Flow | |||
| 1.33B | 935.60M | 410.60M | 594.30M | 1.22B | Operating Cash Flow |
| 1.33B | 1.14B | 596.90M | 781.70M | 1.34B | Investing Cash Flow |
| -657.80M | -637.70M | -262.10M | 157.60M | -735.20M | Financing Cash Flow |
| -477.50M | -403.90M | -818.40M | -1.09B | -264.80M |
Assurant Technical Analysis
Negative
204.06
Price Trends
208.65
Negative
208.63
Negative
193.29
Positive
Market Momentum
-1.31
Negative
47.28
Neutral
26.11
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AIZ, the sentiment is Negative. The current price of 204.06 is below the 20-day moving average (MA) of 205.65, below the 50-day MA of 208.65, and above the 200-day MA of 193.29, indicating a neutral trend. The MACD of -1.31 indicates Negative momentum. The RSI at 47.28 is Neutral, neither overbought nor oversold. The STOCH value of 26.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AIZ.
Assurant Risk Analysis
Assurant disclosed 41 risk factors in its most recent earnings report. Assurant reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Assurant Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $21.67B | 9.64 | 17.61% | 2.31% | 13.22% | 24.83% | |
80 Outperform | $10.36B | 14.20 | 15.33% | 1.48% | 6.70% | 21.03% | |
75 Outperform | $58.18B | 12.00 | 18.94% | 1.61% | 12.23% | 68.50% | |
72 Outperform | $52.67B | 11.81 | 23.80% | 1.83% | 12.28% | ― | |
71 Outperform | $48.61B | 16.10 | 7.10% | 1.91% | -28.56% | 1.14% | |
67 Neutral | $5.82B | 1.93 | 43.24% | 5.06% | 47.95% | ― | |
64 Neutral | $13.88B | 10.79 | 9.29% | 4.15% | 17.66% | -7.41% |
* Financial Sector Average
Performance Comparison
AIZ
Assurant
204.06
25.66
14.38%
ALL
Allstate
201.58
45.13
28.85%
AIG
American International Group
81.63
7.33
9.87%
CINF
Cincinnati Financial
140.13
24.77
21.47%
LNC
Lincoln National
34.81
9.55
37.81%
TRV
Travelers Companies
254.56
37.94
17.51%
Assurant Earnings Call Summary
Earnings Call Date: Feb 11, 2025 | % Change Since: -4.11% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Positive
The earnings call highlighted Assurant's strong financial performance and growth in key segments, supported by strategic client wins and efficient capital management. However, challenges in Global Auto and impacts from foreign exchange and the California wildfires were noted. Overall, the positive aspects, including robust growth and strong client relationships, outweigh the challenges.Highlights
Strong Financial Growth
Assurant achieved 15% adjusted EBITDA growth and 19% adjusted earnings per share growth in 2024, both excluding reportable catastrophes.
Global Housing Performance
Global Housing delivered sustained outperformance, doubling adjusted EBITDA to over $900 million in 2024, excluding catastrophes, with a 10-year average combined ratio of 89%.
Client Wins and Renewals
The company secured several key client wins and renewals, including partnerships with T-Mobile, Australia's largest mobile carrier, and major financial institutions in the U.S.
Capital Returns and Dividend Increase
Assurant returned over $450 million to shareholders in 2024, including $300 million in share repurchases and increased its common stock dividend by 11%.
Lowlights
Global Auto Challenges
Global Auto faced elevated loss experience in GAP and vehicle service contract businesses, despite stabilization efforts.
Foreign Exchange and Investment Headwinds
Assurant faced unfavorable impacts from foreign exchange rates and investment expenses, expected to mute growth by a few percentage points in 2025.
California Wildfire Impact
Reportable catastrophes from the California wildfires are expected to slightly exceed the company's reinsurance program retention of $150 million.
Company Guidance
In the fourth quarter and full year 2024 conference call, Assurant provided strong guidance and performance metrics. The company achieved a 15% growth in adjusted EBITDA and a 19% increase in adjusted earnings per share, excluding reportable catastrophes. This growth was driven by strategic investments and improved performance across key business areas, particularly within Global Lifestyle and Global Automotive segments. The Global Housing segment more than doubled its adjusted EBITDA to over $900 million in 2024, excluding catastrophes, with a 10-year average combined ratio of 89%, outperforming the broader P&C market. Assurant also returned over $450 million to shareholders, including $300 million in share repurchases, while maintaining strong liquidity with $673 million at the holding company. Looking ahead to 2025, the company expects modest growth in both adjusted EBITDA and earnings per share, excluding catastrophes, with continued momentum across its segments and a focus on executing new partnerships and program launches.Assurant Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Assurant Appoints Kevin Warren to Board Amid Changes
Neutral
Nov 20, 2024
Assurant, Inc. announced the appointment of Kevin Warren, former UPS executive, to its Board of Directors, strengthening its expertise in customer experience and strategic growth. Warren’s extensive background with UPS and Xerox brings valuable insights as the company continues to innovate. Meanwhile, long-time Board members Lawrence Jackson and Paget Alves are set to depart, marking a significant transition in leadership at Assurant.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.