ASX:MPL

Stock Analysis Report

Executive Summary

Medibank Private Limited, an integrated healthcare company, provides private health insurance and health solutions in Australia.

Rewards

Trading at 2.7% below its fair value

Earnings have grown 15.7% per year over the past 5 years

Risk Analysis

Earnings are forecast to decline by an average of -2.2% per year for the next 3 years

Unstable dividend track record



Snowflake Analysis

Proven track record second-rate dividend payer.


Similar Companies

Share Price & News

How has Medibank Private's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: MPL has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.9%

MPL

2.5%

AU Insurance

0.5%

AU Market


1 Year Return

40.3%

MPL

16.9%

AU Insurance

19.1%

AU Market

Return vs Industry: MPL exceeded the Australian Insurance industry which returned 16.9% over the past year.

Return vs Market: MPL exceeded the Australian Market which returned 19.1% over the past year.


Shareholder returns

MPLIndustryMarket
7 Day1.9%2.5%0.5%
30 Day3.8%1.6%-0.2%
90 Day-3.0%-2.4%0.4%
1 Year47.3%40.3%23.4%16.9%24.9%19.1%
3 Year35.1%18.5%33.4%14.7%37.0%18.2%
5 Year73.3%42.8%53.8%19.0%58.6%22.8%

Price Volatility Vs. Market

How volatile is Medibank Private's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Medibank Private undervalued compared to its fair value and its price relative to the market?

2.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: MPL (A$3.27) is trading below our estimate of fair value (A$3.36)

Significantly Below Fair Value: MPL is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: MPL is poor value based on its PE Ratio (20.6x) compared to the Insurance industry average (20.4x).

PE vs Market: MPL is poor value based on its PE Ratio (20.6x) compared to the Australian market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: MPL's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: MPL is overvalued based on its PB Ratio (4.7x) compared to the AU Insurance industry average (2.9x).


Next Steps

Future Growth

How is Medibank Private forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

-2.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MPL's earnings are forecast to decline over the next 3 years (-2.2% per year).

Earnings vs Market: MPL's earnings are forecast to decline over the next 3 years (-2.2% per year).

High Growth Earnings: MPL's earnings are forecast to decline over the next 3 years.

Revenue vs Market: MPL's revenue (3.2% per year) is forecast to grow slower than the Australian market (3.5% per year).

High Growth Revenue: MPL's revenue (3.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: MPL's Return on Equity is forecast to be high in 3 years time (20.6%)


Next Steps

Past Performance

How has Medibank Private performed over the past 5 years?

15.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MPL has high quality earnings.

Growing Profit Margin: MPL's current net profit margins (6.5%) are higher than last year (6.4%).


Past Earnings Growth Analysis

Earnings Trend: MPL's earnings have grown by 15.7% per year over the past 5 years.

Accelerating Growth: MPL's earnings growth over the past year (3.2%) is below its 5-year average (15.7% per year).

Earnings vs Industry: MPL earnings growth over the past year (3.2%) underperformed the Insurance industry 7.2%.


Return on Equity

High ROE: MPL's Return on Equity (22.6%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Medibank Private's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: MPL has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if MPL's debt is covered by short term assets.


Financial Institutions Analysis

Asset Level: MPL's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if MPL has a sufficient allowance for bad loans.

Low Risk Liabilities: MPL reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if MPL has an acceptable proportion of non-loan assets held.

Low Risk Deposits: MPL has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if MPL has an appropriate level of bad loans.


Next Steps

Dividend

What is Medibank Private's current dividend yield, its reliability and sustainability?

4.01%

Current Dividend Yield


Dividend Yield vs Market

company4.0%marketbottom25%2.4%markettop25%5.6%industryaverage4.2%forecastin3Years3.9%

Current dividend yield vs market & industry

Notable Dividend: MPL's dividend (4.01%) is higher than the bottom 25% of dividend payers in the Australian market (2.41%).

High Dividend: MPL's dividend (4.01%) is low compared to the top 25% of dividend payers in the Australian market (5.6%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, MPL has been paying a dividend for less than 10 years.

Growing Dividend: MPL's dividend payments have increased, but the company has only paid a dividend for 4 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (82.4%), MPL's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: MPL's dividends in 3 years are forecast to be covered by earnings (84.9% payout ratio).


Next Steps

Management

What is the CEO of Medibank Private's salary, the management and board of directors tenure and is there insider trading?

3.3yrs

Average management tenure


CEO

Craig Drummond (58yo)

3.4yrs

Tenure

AU$4,091,635

Compensation

Mr. Craig M. Drummond, BCom, FCA, SF Fin, has been the Chief Executive Officer at Medibank Private Limited since July 4, 2016 and served as its Managing Director since July 4, 2016. Mr. Drummond served as  ...


CEO Compensation Analysis

Compensation vs Market: Craig's total compensation ($USD2.81M) is about average for companies of similar size in the Australian market ($USD2.90M).

Compensation vs Earnings: Craig's compensation has been consistent with company performance over the past year.


Management Age and Tenure

3.3yrs

Average Tenure

Experienced Management: MPL's management team is considered experienced (3.3 years average tenure).


Board Age and Tenure

5.8yrs

Average Tenure

62yo

Average Age

Experienced Board: MPL's board of directors are considered experienced (5.8 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellAU$305,499,78723 Jul 19
Perpetual Limited
EntityCompany
Shares98,893,672
Max PriceAU$3.09
BuyAU$190,271,98323 Jul 19
Perpetual Limited
EntityCompany
Shares67,449,997
Max PriceAU$2.82
BuyAU$39,71228 Feb 19
Tracey Batten
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares14,285
Max PriceAU$2.78
BuyAU$74,65421 Feb 19
Michael Wilkins
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares25,513
Max PriceAU$2.93
BuyAU$104,300,35606 Feb 19
Schroder Investment Management Limited
EntityCompany
Shares40,598,812
Max PriceAU$2.57

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Craig Drummond (58yo)

    CEO & Director

    • Tenure: 3.4yrs
    • Compensation: AU$4.09m
  • Andrew Wilson

    Group Executive of Healthcare & Strategy

    • Tenure: 9.4yrs
    • Compensation: AU$1.88m
  • Peter Kopanidis

    Senior Executive of Corporate Finance

    • Tenure: 0yrs
  • Mei Ramsay

    Group Executive of Legal

    • Tenure: 3.3yrs
    • Compensation: AU$996.23k
  • David Koczkar

    Group Executive - Chief Customer Officer

    • Tenure: 3.3yrs
    • Compensation: AU$1.78m
  • Kylie Bishop

    Group Executive of People & Culture

    • Tenure: 6.4yrs
    • Compensation: AU$1.02m
  • Andrew Matthews

    Chief Actuary

    • Tenure: 6.7yrs
  • John Goodall

    Group Executive of Technology & Operations

    • Tenure: 3.3yrs
    • Compensation: AU$946.52k
  • Mark Rogers

    Group Executive - Chief Financial Officer

    • Tenure: 2.9yrs
    • Compensation: AU$1.41m
  • Emily Ritchie

    Head of Media & External Affairs

    • Tenure: 0yrs

Board Members

  • Elizabeth Alexander (76yo)

    Independent Chairman of the Board

    • Tenure: 6.8yrs
    • Compensation: AU$445.00k
  • Peter Hodgett

    Independent Non-Executive Director

    • Tenure: 6.5yrs
    • Compensation: AU$219.87k
  • Linda Nicholls (71yo)

    Independent Non-Executive Director

    • Tenure: 5.8yrs
    • Compensation: AU$203.50k
  • Christine O’Reilly (58yo)

    Independent Non-Executive Director

    • Tenure: 5.8yrs
    • Compensation: AU$220.08k
  • Mike Wilkins (62yo)

    Independent Non-Executive Director

    • Tenure: 2.6yrs
    • Compensation: AU$203.09k
  • Craig Drummond (58yo)

    CEO & Director

    • Tenure: 3.4yrs
    • Compensation: AU$4.09m
  • Tracey Batten

    Independent Non-Executive Director

    • Tenure: 2.3yrs
    • Compensation: AU$201.61k
  • Anna Bligh

    Independent Non-Executive Director

    • Tenure: 7yrs
    • Compensation: AU$202.01k
  • David Fagan

    Independent Non-Executive Director

    • Tenure: 5.8yrs
    • Compensation: AU$220.36k

Company Information

Medibank Private Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Medibank Private Limited
  • Ticker: MPL
  • Exchange: ASX
  • Founded: 1976
  • Industry: Life and Health Insurance
  • Sector: Insurance
  • Market Cap: AU$9.006b
  • Shares outstanding: 2.75b
  • Website: https://www.medibank.com.au

Number of Employees


Location

  • Medibank Private Limited
  • 720 Bourke Street
  • Docklands
  • Victoria
  • 3008
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MPLASX (Australian Securities Exchange)YesOrdinary SharesAUAUDNov 2014
MPLCHIA (Chi-X Australia)YesOrdinary SharesAUAUDNov 2014
MPVDB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 2014
MDBP.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDNov 2014

Biography

Medibank Private Limited, an integrated healthcare company, provides private health insurance and health solutions in Australia. It operates in two segments, Health Insurance and Medibank Health. The Healt ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/15 10:35
End of Day Share Price2019/12/13 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.