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Zurich Insurance Group AG ADR ZURVY

Morningstar Rating
$52.50 +0.48 (0.92%)
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Company Report

Zurich Earnings: Raises Dividend and Announces a New Buyback

Zurich Insurance has reported a net income of $4.4 billion for 2023, or $29.96 in basic EPS. These figures are slightly below the $4.6 billion and $30.96 per share that we forecast respectively, but slightly ahead of company-compiled consensus. Zurich’s board is proposing a dividend of CHF 26 per share, higher than we estimated, and is supplementing this distribution with a share buyback of up to CHF 1.1 billion. Zurich’s buoyant results have been driven by a 7% rise in business operating profit in the property and casualty division as the unit has kept its underwriting quality and reserve strength stable. Commercial insurance, one of the moaty parts of Zurich’s business, at 90.7%, delivered a better result than the division combined. The life business has reported a double-digit rise in operating profit as sales have been particularly strong in retail products across Spain through the firm’s joint venture with Banco Sabadell. Sales of protection in the Asia-Pacific region and sales of unit-linked products in South America have also helped. Farmers Group's operating profit has risen 10% over the year, with mid-single-digit growth in the top line as the fee margin increased after Zurich acquired and integrated the MetLife business.

Price vs Fair Value

ZURVY is trading at a 5% discount.
Price
$52.50
Fair Value
$12.00
Uncertainty
Low
1-Star Price
$38.94
5-Star Price
$94.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Zurich’s Farmers Management Services is a low capital requirement, high margin, reliable, and wide-moat intangible asset business.

Bears

Zurich is underweight mid-market commercial insurance versus some North American peers.

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News

Trading Information

Previous Close Price
$52.02
Day Range
$52.3252.63
52-Week Range
$42.9652.63
Bid/Ask
$52.77 / $52.98
Market Cap
$75.59 Bil
Volume/Avg
49,757 / 49,783

Key Statistics

Price/Earnings (Normalized)
12.77
Price/Sales
1.10
Dividend Yield (Trailing)
5.10%
Dividend Yield (Forward)
5.10%
Total Yield
7.88%

Company Profile

Zurich is a multiline insurer that writes business across both life and non-life insurance and also owns Farmers Management Services. The company was founded in 1872, originally as a marine reinsurer, to provide reinsurance to its parent company. Zurich subsequently expanded into transport and accident insurance and then rode the wave of transport technology innovation that drove rising demand for insurance. One of Zurich’s early principles was that setting prices too low would result in unfair claims handling that would be damaging to both customers and Zurich. Over the years Zurich has sought to combine goodwill in claims with a sufficient premium. Zurich is now one of the most successful insurers in Europe.
Sector
Financial Services
Industry
Insurance - Diversified
Stock Style Box
Large Value
Total Number of Employees
60,000

Competitors

Valuation

Metric
ZURVY
ALV
AV.
Price/Earnings (Normalized)
12.7711.397.01
Price/Book Value
3.061.751.26
Price/Sales
1.100.540.99
Price/Cash Flow
1.42
Price/Earnings
ZURVY
ALV
AV.

Financial Strength

Metric
ZURVY
ALV
AV.
Quick Ratio
Current Ratio
Interest Coverage
16.289.62−1.04
Quick Ratio
No chart available

Profitability

Metric
ZURVY
ALV
AV.
Return on Assets (Normalized)
1.33%1.27%0.60%
Return on Equity (Normalized)
18.88%23.06%16.14%
Return on Invested Capital (Normalized)
9.34%17.23%11.20%
Return on Assets
ZURVY
ALV
AV.
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