NYSE:AEL

Stock Analysis Report

American Equity Investment Life Holding

Executive Summary

American Equity Investment Life Holding Company, through its subsidiaries, provides life insurance products and services in the United States.

Snowflake

Fundamentals

Very undervalued average dividend payer.


Similar Companies

Share Price & News

How has American Equity Investment Life Holding's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

3.5%

AEL

-1.2%

US Insurance

0.07%

US Market


1 Year Return

-24.4%

AEL

15.3%

US Insurance

8.9%

US Market

Return vs Industry: AEL underperformed the US Insurance industry which returned 15.3% over the past year.

Return vs Market: AEL underperformed the US Market which returned 8.9% over the past year.


Shareholder returns

AELIndustryMarket
7 Day3.5%-1.2%0.07%
30 Day1.6%-2.8%-0.3%
90 Day-7.6%-3.7%-1.6%
1 Year-23.8%-24.4%18.2%15.3%11.3%8.9%
3 Year44.5%40.5%44.2%33.1%46.3%36.8%
5 Year2.5%-2.0%66.2%46.3%62.1%44.3%

Price Volatility Vs. Market

How volatile is American Equity Investment Life Holding's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is American Equity Investment Life Holding undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: AEL ($24.51) is trading below our estimate of fair value ($72.5)

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


Price To Earnings Ratio

PE vs Industry: AEL is good value based on its PE Ratio (10.5x) compared to the Insurance industry average (15.8x).

PE vs Market: AEL is good value based on its PE Ratio (10.5x) compared to the US market (17.8x).


Price to Earnings Growth Ratio

PEG Ratio: AEL is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: AEL is good value based on its PB Ratio (0.6x) compared to the US Insurance industry average (1.2x).


Next Steps

Future Growth

How is American Equity Investment Life Holding forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

29.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AEL's forecast earnings growth (29% per year) is above the savings rate (2.7%).

Earnings vs Market: AEL's earnings (29% per year) are forecast to grow faster than the US market (14.5% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: AEL's revenue (5.6% per year) is forecast to grow slower than the US market (7.2% per year).

High Growth Revenue: AEL's revenue (5.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AEL's Return on Equity is forecast to be low in 3 years time (12.2%).


Next Steps

Past Performance

How has American Equity Investment Life Holding performed over the past 5 years?

21.0%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: AEL's earnings have grown significantly by 21% per year over the past 5 years.

Accelerating Growth: AEL's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: AEL had negative earnings growth (-35.6%) over the past year, making it difficult to compare to the Insurance industry average (2%).


Return on Equity

High ROE: AEL's Return on Equity (6.1%) is considered low.


Return on Assets

ROA vs Industry: AEL's Return on Assets is below or equal to the Insurance industry average last year.


Return on Capital Employed

ROCE Improving: AEL has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is American Equity Investment Life Holding'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: AEL has a low level of unsold assets or inventory.

Debt Coverage by Assets: AEL's debt is covered by short term assets (assets are 3.563230x debt).


Financial Institutions Analysis

Asset Level: AEL's level of assets compared to its equity is moderate.

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

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

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

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

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


Next Steps

Dividend

What is American Equity Investment Life Holding's current dividend yield, its reliability and sustainability?

1.14%

Current Dividend Yield


Dividend Yield vs Market

company1.1%marketbottom25%1.4%markettop25%3.7%industryaverage2.4%forecastin3Years1.3%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: AEL's dividend (1.14%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.45%).

High Dividend: AEL's dividend (1.14%) is low compared to the top 25% of dividend payers in the US market (3.68%).

Stable Dividend: AEL's dividends per share have been stable in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (12%), AEL's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AEL's dividends in 3 years are forecast to be thoroughly covered by earnings (8.1% payout ratio).


Next Steps

Management

What is the CEO of American Equity Investment Life Holding's salary, the management and board of directors tenure and is there insider trading?

3.8yrs

Average management tenure


CEO

John Matovina (65yo)

7.3yrs

Tenure

US$3,552,535

Compensation

Mr. John Michael Matovina has been the Chief Executive Officer and President of American Equity Investment Life Holding Company since June 27, 2012. Mr. Matovina served as the Chief Financial Officer and T ...


CEO Compensation Analysis

Compensation vs. Market: John's total compensation ($USD3.55M) is about average for companies of similar size in the US market ($USD4.07M).

Compensation vs Earnings: John's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

3.8yrs

Average Tenure

49yo

Average Age

Experienced Management: AEL's management team is considered experienced (3.8 years average tenure).


Board Age and Tenure

9.7yrs

Average Tenure

66.5yo

Average Age

Experienced Board: AEL's board of directors are considered experienced (9.7 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

SellUS$338,25401 Jul 19
Jeffrey Lorenzen
EntityIndividual
Role
Chief Investment Officer
Executive VP & Chief Investment Officer
Shares12,413
Max PriceUS$27.25
SellUS$269,00001 Jul 19
Joyce Chapman
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares10,000
Max PriceUS$26.90
SellUS$261,10027 Jun 19
Ted Johnson
EntityIndividual
Role
Chief Financial Officer
CFO & Treasurer
Shares10,000
Max PriceUS$26.11
SellUS$2,192,14420 Jun 19
Debra Richardson
EntityIndividual
Role
Member of the Board of Directors
Director
Shares80,000
Max PriceUS$27.40

Ownership Breakdown


Management Team

  • Julie LaFollette

    Director of Investor Relations

    • Tenure: 0yrs
  • Ted Johnson (49yo)

    CFO & Treasurer

    • Tenure: 7.3yrs
    • Compensation: US$1.95m
  • John Matovina (65yo)

    Chairman

    • Tenure: 7.3yrs
    • Compensation: US$3.55m
  • Jeff Lorenzen (53yo)

    Executive VP & Chief Investment Officer

    • Tenure: 10.8yrs
    • Compensation: US$1.68m
  • Ron Grensteiner (56yo)

    President of American Equity Investment Life Insurance Company

    • Tenure: 0yrs
    • Compensation: US$1.86m
  • Scott Samuelson (46yo)

    VP & Chief Accounting Officer

    • Tenure: 2.3yrs
  • Renee Montz (47yo)

    Executive VP

    • Tenure: 3.5yrs
    • Compensation: US$1.63m
  • Steven Schwartz

    Vice President of Investor Relations

    • Tenure: 3.8yrs
  • Harley Whitfield

    Senior Vice President of Resolutions

    • Tenure: 0yrs
  • Jennifer Bryant (47yo)

    Executive VP & Chief HR Officer

    • Tenure: 3yrs

Board Members

  • Bill Kunkel (62yo)

    Independent Director

    • Tenure: 3.3yrs
    • Compensation: US$176.30k
  • Joyce Chapman (74yo)

    Independent Director

    • Tenure: 11.2yrs
    • Compensation: US$183.04k
  • David Mulcahy (66yo)

    Independent Director

    • Tenure: 8.8yrs
    • Compensation: US$212.54k
  • James Gerlach (76yo)

    Independent Director

    • Tenure: 23.8yrs
    • Compensation: US$173.80k
  • John Matovina (65yo)

    Chairman

    • Tenure: 7.3yrs
    • Compensation: US$3.55m
  • Debbie Richardson (62yo)

    Director

    • Tenure: 11.2yrs
    • Compensation: US$169.30k
  • Lonnie Strickland (77yo)

    Independent Director

    • Tenure: 23.8yrs
    • Compensation: US$182.30k
  • Bob Howe (76yo)

    Lead Independent Director

    • Tenure: 10.2yrs
    • Compensation: US$202.80k
  • Alan Matula (59yo)

    Independent Director

    • Tenure: 3.8yrs
    • Compensation: US$170.80k
  • Gerard Neugent (67yo)

    Independent Director

    • Tenure: 9.2yrs
    • Compensation: US$172.51k

Company Information

American Equity Investment Life Holding Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: American Equity Investment Life Holding Company
  • Ticker: AEL
  • Exchange: NYSE
  • Founded: 1995
  • Industry: Life and Health Insurance
  • Sector: Insurance
  • Market Cap: US$2.231b
  • Shares outstanding: 91.02m
  • Website: https://www.american-equity.com

Number of Employees


Location

  • American Equity Investment Life Holding Company
  • 6000 Westown Parkway
  • West Des Moines
  • Iowa
  • 50266
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AELNYSE (New York Stock Exchange)YesCommon StockUSUSDDec 2003

Biography

American Equity Investment Life Holding Company, through its subsidiaries, provides life insurance products and services in the United States. The company issues fixed index and rate annuities; and single  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/22 23:55
End of Day Share Price2019/10/22 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.