Aspen Insurance Holdings Ltd (NYSE: AHL)

Sector: Financial Services Industry: Insurance - Property & Casualty CIK: 0001267395
Market Cap 4.51 Bn
P/B 1.30
P/E 11.25
P/S 1.38
ROIC (Qtr) 11.60
Div Yield % 0.00
Rev 1y % (Qtr) 0.76
Total Debt (Qtr) 364.30 Mn
Debt/Equity (Qtr) 0.10
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About

Investment thesis

Bull case

  • Strong operating cash flow of 311.70M provides robust 0.86x coverage of total debt 364.30M, indicating excellent debt servicing capability and financial flexibility.
  • Strong tangible asset base of 16.39B provides 44.99x coverage of total debt 364.30M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 285.90M exceeds capital expenditure of 25.80M by 11.08x, indicating strong organic growth funding capability.
  • Tangible assets of 16.39B provide exceptional 5.66x coverage of deferred revenue 2.90B, showing strong service capability backing.
  • Operating cash flow of 311.70M provides strong 32.13x coverage of tax liabilities 9.70M, showing excellent fiscal position.

Bear case

  • Operating cash flow of 311.70M barely covers its investment activities of (399.50M), with a coverage ratio of -0.78, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 311.70M provides insufficient coverage of deferred revenue obligations of 2.90B, which is 0.11x, raising concerns about future service delivery capabilities.
  • Retained earnings of 2.20B provide limited buffer against comprehensive income items of (221.10M), which is -9.93x, indicating elevated exposure to market risks.
  • R&D investment of 0 represents just 0x of SG&A expenses of 1.07B, indicating potential underinvestment in innovation relative to administrative overhead.
  • Fixed assets of 45.90M showing 2.61x ratio to depreciation of 17.60M indicates aging infrastructure requiring significant near-term capital investment.

Peer comparison

Companies in the Insurance - Property & Casualty
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 PGR Progressive Corp/Oh/ 121.46 Bn 30.80 3.11 6.90 Bn
2 CB Chubb Ltd 109.27 Bn 36.88 5.64 21.01 Bn
3 ALL Allstate Corp 69.21 Bn 29.01 1.62 8.09 Bn
4 TRV Travelers Companies, Inc. 67.61 Bn 10.75 1.38 9.27 Bn
5 HIG Hartford Insurance Group, Inc. 61.19 Bn 37.09 3.27 4.37 Bn
6 WRB Berkley W R Corp 38.52 Bn 124.63 8.69 2.87 Bn
7 CINF Cincinnati Financial Corp 26.91 Bn 74.14 6.73 0.88 Bn
8 MKL Markel Group Inc. 26.46 Bn 13.00 1.68 4.28 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.24 0.50
EV to Cash from Ops. EV/CFO 12.65 -16.03
EV to Debt EV to Debt 10.82 11.42
EV to EBIT EV/EBIT 7.98 22.13
EV to EBITDA EV/EBITDA 6.83 17.53
EV to Free Cash Flow [EV/FCF] EV/FCF 13.79 68.07
EV to Market Cap EV to Market Cap 0.87 0.91
EV to Revenue EV/Rev 1.20 2.31
Price to Book Value [P/B] P/B 1.30 2.97
Price to Earnings [P/E] P/E 11.25 29.62
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 7.41
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 19.66
Dividend per Basic Share Div per Share (Qtr) 0.00 1.49
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 37.69
Interest Coverage Int. cover (Qtr) 12.92 -9.19
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -132.43 -17.83
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -9.49 30.27
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 16.34
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -12.21 62.82
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 12.56 35.62
EBIT Growth (1y) % EBIT 1y % (Qtr) 26.36 56.25
EBT Growth (1y) % EBT 1y % (Qtr) 39.90 52.70
EPS Growth (1y) % EPS 1y % (Qtr) 9.21 48.20
FCF Growth (1y) % FCF 1y % (Qtr) -26.18 15.47
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 13.40 16.55
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.20 0.38
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.45
Cash Ratio Cash Ratio 0.00 0.02
Current Ratio Current Ratio 0.00 0.06
Debt to Equity Ratio Debt/Equity (Qtr) 0.10 0.23
Interest Cover Ratio Int Coverage (Qtr) 12.92 -9.19
Times Interest Earned Times Interest Earned (Qtr) 12.92 -9.19
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 15.60 14.01
EBIT Margin % EBIT Margin % (Qtr) 15.08 13.05
EBT Margin % EBT Margin % (Qtr) 13.91 12.25
Gross Margin % Gross Margin % (Qtr) 49.80 40.49
Net Profit Margin % Net Margin % (Qtr) 12.30 9.63