Analysis of Unum Group, one of the leading players in the disability insurance industry
Unum Group is an insurance company that specializes in disability insurance and operates in many markets, which can be very interesting given its solid results and low P/E and P/B ratios.
Unum Group is an American company that specializes in disability and employee life insurance. The company provides products and services to individuals, employers and other organizations. Unum Group's products include long-term and short-term disability insurance plans, retirement savings plans, health care plans, and life insurance. Unum Group is one of the largest disability insurance companies in North America and also operates in Europe and Asia.
Unum Group specializes in disability insurance and offers a wide range of products including:
Long-term disability insurance: disability insurance is a product that provides financial support in the event that a client becomes disabled and is unable to work.
Short-term disability insurance: this product provides financial support in the event of short-term disability, for example in the event of illness or accident.
Retirement Savings Plans: Unum Group also offers retirement savings plans that allow clients to save for retirement and prepare for old age.
Health Care Plans: Unum Group also offers health care plans that provide financial support in case a client becomes seriously ill and needs long-term treatment.
Life insurance: the company also offers life insurance that provides financial protection in the event of a client's death.
Unum Group has several competitive advantages:
Disability Specialization: Unum Group specializes in providing disability insurance, which allows it to offer quality and specialized products and services. This specialization is also supported by broad experience and expertise in the field.
Quality Customer Service: Unum Group focuses on quality customer service and strives to provide customers with the best possible support and assistance when needed. The company provides customer support via phone, email and online chat.
Broad Product Portfolio: Unum Group offers a broad portfolio of products, including long-term and short-term disability insurance plans, retirement savings plans, health care plans and life insurance. This range of products allows customers to find the solution that best suits their needs.
International presence: the Unum Group operates in many countries around the world, enabling it to offer its products and services in different regions and markets. This global reach allows the company to respond effectively to different needs and trends in different regions.
Like any investment, an investment in Unum Group shares carries certain risks that investors should consider:
Business cycle risk: As an insurance company, Unum Group may be affected by economic cycles and recessions that may lead to deteriorating market conditions and reduced demand for its products and services.
Risk of investment losses: Unum Group invests a portion of its income in financial assets such as stocks and bonds. If these investments are unsuccessful, this could have a negative impact on the company's performance and profitability.
Competitive risk: The disability and life insurance market is highly competitive. If new competition were to emerge in the market or if existing competition were to improve, it could result in a loss of customers and a reduction in the Company's market share.
Highlights from the income statement are:
- Total sales have ranged between $11.8 billion and $13.2 billion over the past four years. The most recent year (TTM) was $11.9 billion.
- Total expenses have ranged between $10.2 and $12.2 billion over the past four years. In the most recent year, they reached a value of $10.3 billion.
- Pre-tax profits reached $1.6 billion in the most recent year, a significant improvement over the previous three years.
- Tangible earnings per share reached $6.50 in the most recent year, an improvement over the previous year.
Overall, the company has had a steady performance with sales and expenses holding at similar levels over the past few years. Although profit before tax has increased significantly over the past year, net income has only grown modestly. This may be due to income tax developments and other influences on the company's performance.
- Total assets have ranged between $61.4 billion and $70.6 billion over the past four years. In the most recent year, it reached $61.4 billion, a slight decrease from the previous year.
- Total liabilities have ranged between $52.2 billion and $59.8 billion over the past four years. In the most recent year, they reached $52.2 billion, a slight decrease from the previous year.
- Total capital has ranged between $12.6 billion and $14.9 billion over the past four years. In the most recent year, it was $12.6 billion, a slight decrease from the previous year.
- Shareholders' equity has ranged between $9.2 billion and $11.4 billion over the past four years. In the last year, it was $9.2 billion, a slight decrease from the previous year.
- Total debt has ranged between $3.1 billion and $3.4 billion over the past four years. In the most recent year, it reached $3.4 billion, a slight increase from the previous year.
Overall, the company has a stable balance sheet and maintains a reasonable level of debt. Shareholders' equity and total capital decreased slightly, which may be due to the purchase of treasury stock or the payment of dividends. Total assets have decreased slightly, which may be the result of changes in the company's investment strategy. Total debt has increased slightly but still remains at a reasonable level relative to the company's total assets.
- The P/E ratio is 6.13, this suggests that the stock may be relatively cheap compared to other companies in the industry with higher P/E ratios.
- EPS for the past 12 months is $6.50, which is solid.
- The company's market capitalization is $8.27 billion.
- The PEG (Price/Earnings to Growth) ratio is 0.62, suggesting that the stock may be relatively cheap compared to expected earnings growth.
- The dividend yield is 3.31% with a payout ratio of 19.20%.
- The company has a relatively low P/B (Price/Book) ratio, indicating that the share price is relatively low.
- The ROI (Return on Investment) is 11.90%, which indicates that the company is earning relatively good returns on its investments.
Overall, the company has a solid financial performance with low P/E and P/B ratios, which could indicate that the stock is relatively cheap. However, high volatility and low liquidity can be risk factors for investors.
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Please note that this is not financial advice. Each investment must go through a thorough analysis.