ASX:NHF

Stock Analysis Report

Executive Summary

nib holdings limited, together with its subsidiaries, underwrites and distributes health insurance to residents, and international students and visitors Australian, New Zealand, and internationally.

Rewards

Trading at 25.1% below its fair value

Earnings grew by 12.8% over the past year

Risk Analysis

Earnings are forecast to decline by an average of -0.6% per year for the next 3 years

Unstable dividend track record

Highly volatile share price over past 3 months



Snowflake Analysis

Solid track record, good value and pays a dividend.


Similar Companies

Share Price & News

How has nib holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NHF's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-3.5%

NHF

-0.3%

AU Insurance

0.7%

AU Market


1 Year Return

-6.8%

NHF

5.6%

AU Insurance

15.8%

AU Market

Return vs Industry: NHF underperformed the Australian Insurance industry which returned 5.6% over the past year.

Return vs Market: NHF underperformed the Australian Market which returned 15.8% over the past year.


Shareholder returns

NHFIndustryMarket
7 Day-3.5%-0.3%0.7%
30 Day-7.1%-4.3%0.4%
90 Day-21.6%-0.4%6.5%
1 Year-3.4%-6.8%11.4%5.6%21.0%15.8%
3 Year7.6%-2.4%26.7%8.7%37.4%19.1%
5 Year70.8%44.2%40.5%9.1%50.7%17.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is nib holdings undervalued compared to its fair value and its price relative to the market?

25.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: NHF (A$5.22) is trading below our estimate of fair value (A$6.97)

Significantly Below Fair Value: NHF is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: NHF is good value based on its PE Ratio (15.9x) compared to the Insurance industry average (18.9x).

PE vs Market: NHF is good value based on its PE Ratio (15.9x) compared to the Australian market (18.6x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: NHF is overvalued based on its PB Ratio (3.8x) compared to the AU Insurance industry average (3.1x).


Next Steps

Future Growth

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

-0.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NHF's earnings are forecast to decline over the next 3 years (-0.6% per year).

Earnings vs Market: NHF's earnings are forecast to decline over the next 3 years (-0.6% per year).

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

Revenue vs Market: NHF's revenue (2.7% per year) is forecast to grow slower than the Australian market (4.2% per year).

High Growth Revenue: NHF's revenue (2.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NHF's Return on Equity is forecast to be high in 3 years time (20.9%)


Next Steps

Past Performance

How has nib holdings performed over the past 5 years?

16.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NHF has high quality earnings.

Growing Profit Margin: NHF's current net profit margins (6.1%) are higher than last year (5.9%).


Past Earnings Growth Analysis

Earnings Trend: NHF's earnings have grown by 16.2% per year over the past 5 years.

Accelerating Growth: NHF's earnings growth over the past year (12.8%) is below its 5-year average (16.2% per year).

Earnings vs Industry: NHF earnings growth over the past year (12.8%) exceeded the Insurance industry 10.5%.


Return on Equity

High ROE: NHF's Return on Equity (23.6%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is nib holdings'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: NHF has a low level of unsold assets or inventory.

Debt Coverage by Assets: NHF's debt is covered by short term assets (assets are 4.5x debt).


Financial Institutions Analysis

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

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

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

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

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

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


Next Steps

Dividend

What is nib holdings's current dividend yield, its reliability and sustainability?

4.41%

Current Dividend Yield


Dividend Yield vs Market

company4.4%marketbottom25%2.3%markettop25%5.4%industryaverage4.3%forecastin3Years3.9%

Current dividend yield vs market & industry

Notable Dividend: NHF's dividend (4.41%) is higher than the bottom 25% of dividend payers in the Australian market (2.3%).

High Dividend: NHF's dividend (4.41%) is low compared to the top 25% of dividend payers in the Australian market (5.42%).


Stability and Growth of Payments

Stable Dividend: NHF's dividend payments have been volatile in the past 10 years.

Growing Dividend: NHF's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (70.2%), NHF's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: NHF's dividends in 3 years are forecast to be covered by earnings (64.3% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

7.2yrs

Average management tenure


CEO

Mark Fitzgibbon (59yo)

12.8yrs

Tenure

AU$3,885,667

Compensation

Mr. Mark Fitzgibbon, MBA( UTS ), MA( MGSM ), ALCA, FAICD has been the Chief Executive Officer of NIB Holdings Limited since October 2002 and has been its Managing Director since May 2007. Mr. Fitzgibbon ha ...


CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD2.59M) is above average for companies of similar size in the Australian market ($USD1.33M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Mark Fitzgibbon
MD, CEO & Executive Director12.8yrsAU$3.89m0.57% A$13.6m
Michelle McPherson
CFO & Deputy CEO16.9yrsAU$1.69m0.18% A$4.3m
Brendan Mills
Chief Information Officer7.7yrsAU$881.65k0.035% A$825.9k
Roslyn Toms
Chief Risk Officer2.6yrsAU$684.34k0.0040% A$94.6k
Wendy Lenton
Group Executive of People & Culture2.5yrsAU$696.91k0.0029% A$68.7k
Rob Hennin
Chief Executive Officer of NIB New Zealand6.8yrsAU$1.09m0.045% A$1.1m
Matthew Neat
Head of Corporate Affairs & Investor Relations0yrsno datano data
Jordan French
Company Secretary0yrsno datano data

7.2yrs

Average Tenure

Experienced Management: NHF's management team is seasoned and experienced (7.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Mark Fitzgibbon
MD, CEO & Executive Director12.8yrsAU$3.89m0.57% A$13.6m
Steven Crane
Independent Chairman of the Board8.3yrsAU$311.00k0.055% A$1.3m
Donal O'Dwyer
Independent Non-Executive Director3.9yrsAU$173.94k0.0091% A$216.4k
Lee Ausburn
Independent Non-Executive Director6.3yrsAU$174.50k0.0068% A$161.3k
Christine McLoughlin
Independent Non-Executive Director8.9yrsAU$174.50k0.024% A$578.8k
Jacqueline Chow
Independent Non-Executive Director1.8yrsAU$156.00k0.011% A$261.1k
Anne Loveridge
Independent Non-Executive Director3yrsAU$236.00k0.0053% A$124.7k

6.3yrs

Average Tenure

59yo

Average Age

Experienced Board: NHF's board of directors are considered experienced (6.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

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


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

nib holdings limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: nib holdings limited
  • Ticker: NHF
  • Exchange: ASX
  • Founded: 1952
  • Industry: Life and Health Insurance
  • Sector: Insurance
  • Market Cap: AU$2.376b
  • Shares outstanding: 455.16m
  • Website: https://www.nib.com.au

Number of Employees


Location

  • nib holdings limited
  • 22 Honeysuckle Drive
  • Newcastle
  • New South Wales
  • 2300
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NHFASX (Australian Securities Exchange)YesOrdinary SharesAUAUDNov 2007
3GUDB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 2007
NHFCHIA (Chi-X Australia)YesOrdinary SharesAUAUDNov 2007

Biography

nib holdings limited, together with its subsidiaries, underwrites and distributes health insurance to residents, and international students and visitors Australian, New Zealand, and internationally. It operates through Australian Residents Health Insurance, New Zealand Residents Health Insurance, International (Inbound) Health Insurance, and nib Travel segments. The company offers health insurance products, including single, couples, and family health insurance; life insurance; travel insurance; and funeral and income protection insurance services, as well as health insurance for international workers. nib holdings limited was founded in 1952 and is headquartered in Newcastle, Australia. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/20 10:36
End of Day Share Price2020/02/20 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.