Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 3 stocks made the list for top value stocks in the Insurance - Multiline & Brokers industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Insurance - Multiline & Brokers Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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3 Undervalued Insurance - Multiline & Brokers Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 3 undervalued stocks in the Insurance - Multiline & Brokers industry for Monday, July 22, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Insurance - Multiline & Brokers industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Assurant Inc’s Value Grade

Value Grade:

Assurant, Inc. is a global business services company, which supports, protects, and connects consumer purchases. The Company operates in North America, Latin America, Europe, and Asia Pacific through two segments: Global Lifestyle and Global Housing. The Global Lifestyle segment consists of Connected Living, which provides mobile device solutions, extended service contracts and related services for consumer electronics and appliances, and credit and other insurance products, as well as iSmash, a provider of mobile device solutions, and Global Automotive, which offers vehicle protection services, commercial equipment services and other related services. Through its Global Housing segment, it provides lender-placed homeowners, manufactured housing and flood insurance, as well as voluntary manufactured housing, condominium and homeowners insurance (Homeowners), and renters insurance and other products (Renters and Other).

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Assurant Inc has a Value Score of 74, which is considered to be undervalued.

When you look at Assurant Inc’s price-to-sales ratio at 0.78 compared to the industry median at 1.08, this company has a lower price relative to revenue compared to its peers. This could make Assurant Inc’s stock more attractive for value investors.

Assurant Inc’s price-earnings ratio is 11.87 compared to the industry median at 16.47. This means it has a lower share price relative to earnings compared to its peers. This could make Assurant Inc more attractive for value investors.

Now, let’s assess Assurant Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 8.4, when compared to the industry median of 13.5, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Assurant Inc’s shareholder yield is higher than its industry median ratio of 2.37%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Assurant Inc’s price-to-book ratio is higher than its industry median ratio of 1.77. This could make Assurant Inc less attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Assurant Inc’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Assurant Inc’s price-to-free-cash-flow ratio is higher than its industry median ratio of 15.12. This could make Assurant Inc fairly attractive because the higher P/FCF ratio indicates that Assurant Inc is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

Huize Holding Ltd (ADR)’s Value Grade

Value Grade:

Huize Holding Limited is a China-based company that mainly provides online insurance product and service platform management services. The Company is primarily engaged in the provision of insurance brokerage services. The Company distributes on its platform insurance products underwritten by the insurance companies who cooperate with it, and help them reach a number of insurance clients. The Company's online platform offers digitalized insurance purchase experience and services through various internet and mobile internet channels. Its products cover two categories, life and health insurance products, and property and casualty insurance products. The Company mainly operates in the domestic market.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Huize Holding Ltd (ADR) has a Value Score of 97, which is considered to be undervalued.

Huize Holding Ltd (ADR)’s price-earnings ratio is 6.1 compared to the industry median at 16.5. This means that it has a lower price relative to its earnings compared to its peers. This makes Huize Holding Ltd (ADR) more attractive for value investors.

Huize Holding Ltd (ADR)’s price-to-book ratio is higher than its peers. This could make Huize Holding Ltd (ADR) less attractive for value investors when compared to the industry median at 1.77.

You can read more about Huize Holding Ltd (ADR)’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Waterdrop Inc - ADR’s Value Grade

Value Grade:

Waterdrop Inc is an insurance company. The Company is mainly engaged in operating an independent third-party insurance platform dedicated to providing insurance and healthcare service. The Company’s main businesses are the insurance marketplace, medical crowdfunding, and mutual aid. The insurance marketplace business is collaborated with insurance carriers to offer health and life insurance products to ensure a smooth and friendly user experience throughout the process from underwriting to claim services. The medical crowdfunding business is enabled people with significant medical costs need to seek help from caring hearts through technology. Patients or their relatives or friends can initiate crowdfunding campaigns on the platform and share campaign information through social networks. Mutual aid business operates the Waterdrop Mutual Aid platform enabled participants to help one another to ease their medical cost burden.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Waterdrop Inc - ADR has a Value Score of 62, which is considered to be undervalued.

Waterdrop Inc - ADR’s price-earnings ratio is 15.1 compared to the industry median at 16.5. This means that it has a lower price relative to its earnings compared to its peers. This makes Waterdrop Inc - ADR more attractive for value investors.

Waterdrop Inc - ADR’s price-to-book ratio is higher than its peers. This could make Waterdrop Inc - ADR less attractive for value investors when compared to the industry median at 1.77.

You can read more about Waterdrop Inc - ADR’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Insurance - Multiline & Brokers Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Insurance - Multiline & Brokers stocks as well as other industrys.

Choosing Which of the 3 Best Insurance - Multiline & Brokers Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Assurant Inc stock has a Value Grade of B.
• Huize Holding Ltd (ADR) stock has a Value Grade of A.
• Waterdrop Inc - ADR stock has a Value Grade of B.

Now that you have a bit more background about each of the 3 undervalued stocks in the Insurance - Multiline & Brokers industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Insurance - Multiline & Brokers Stocks

Want to learn more about Insurance - Multiline & Brokers stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 3 Undervalued Insurance - Multiline & Brokers Stocks for Monday, July 22
• Why Abacus Life Inc’s (ABL) Stock Is Up 20.29%
• What You Need to Know About Marsh & McLennan Companies Inc's Q2 Earnings
• 3 Undervalued Insurance - Multiline & Brokers Stocks for Wednesday, July 17

AAII Disclaimer

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