JSE:SLM

Stock Analysis Report

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Executive Summary

Sanlam Limited provides various financial solutions to individual, business, and institutional clients.


Snowflake Analysis

Adequate balance sheet average dividend payer.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

9.8%

SLM

11.1%

ZA Insurance

6.1%

ZA Market


1 Year Return

-19.0%

SLM

-22.0%

ZA Insurance

-20.8%

ZA Market

Return vs Industry: SLM exceeded the ZA Insurance industry which returned -22% over the past year.

Return vs Market: SLM exceeded the ZA Market which returned -20.8% over the past year.


Shareholder returns

SLMIndustryMarket
7 Day9.8%11.1%6.1%
30 Day9.6%10.4%6.9%
90 Day-3.3%-1.5%-3.0%
1 Year-13.8%-19.0%-17.3%-22.0%-9.3%-20.8%
3 Year6.5%-7.3%-1.7%-12.4%8.2%-12.5%
5 Year14.8%-7.6%0.1%-17.3%15.2%-13.9%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

17.97x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: SLM (ZAR62.13) is trading above our estimate of fair value (ZAR25.34)

Significantly Below Fair Value: SLM is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: SLM is poor value based on its PE Ratio (18x) compared to the Insurance industry average (10.9x).

PE vs Market: SLM is poor value based on its PE Ratio (18x) compared to the ZA market (8.4x).


Price to Earnings Growth Ratio

PEG Ratio: SLM is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: SLM is overvalued based on its PB Ratio (1.9x) compared to the ZA Insurance industry average (1.6x).


Next Steps

Future Growth

How is Sanlam forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

21.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SLM's forecast earnings growth (21.1% per year) is above the savings rate (9.5%).

Earnings vs Market: SLM's earnings (21.1% per year) are forecast to grow faster than the ZA market (19.6% per year).

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

Revenue vs Market: SLM's revenue is expected to decline over the next 3 years (-19.7% per year).

High Growth Revenue: SLM's revenue is forecast to decline over the next 3 years (-19.7% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SLM's Return on Equity is forecast to be low in 3 years time (13.9%).


Next Steps

Past Performance

How has Sanlam performed over the past 5 years?

1.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SLM has high quality earnings.

Growing Profit Margin: SLM's current net profit margins (4.5%) are lower than last year (14.7%).


Past Earnings Growth Analysis

Earnings Trend: SLM's earnings have grown by 1.8% per year over the past 5 years.

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

Earnings vs Industry: SLM had negative earnings growth (-38.5%) over the past year, making it difficult to compare to the Insurance industry average (10.7%).


Return on Equity

High ROE: SLM's Return on Equity (11.1%) is considered low.


Next Steps

Financial Health

How is Sanlam's financial position?


Financial Position Analysis

Short Term Liabilities: SLM's short term assets (ZAR131.1B) exceed its short term liabilities (ZAR60.4B).

Long Term Liabilities: SLM's short term assets (ZAR131.1B) do not cover its long term liabilities (ZAR760.5B).


Debt to Equity History and Analysis

Debt Level: SLM's debt to equity ratio (14.1%) is considered satisfactory.

Reducing Debt: SLM's debt to equity ratio has increased from 11.3% to 14.1% over the past 5 years.

Debt Coverage: SLM's debt is well covered by operating cash flow (125.8%).

Interest Coverage: SLM's interest payments on its debt are well covered by EBIT (13.6x coverage).


Balance Sheet


Next Steps

Dividend

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

5.38%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SLM's dividend (5.38%) is higher than the bottom 25% of dividend payers in the ZA market (4.19%).

High Dividend: SLM's dividend (5.38%) is low compared to the top 25% of dividend payers in the ZA market (11.59%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (96.6%), SLM's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SLM's dividends in 3 years are forecast to be covered by earnings (64.8% payout ratio).


Next Steps

Management

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

5.2yrs

Average management tenure


CEO

Ian Kirk (61yo)

4.92yrs

Tenure

R22,521,000

Compensation

Mr. Ian Maxwell Kirk, FCA ( Ireland), CA(SA), HD ip BDP (Wits), has been the Group Chief Executive Officer and Executive Director of Sanlam Limited since July 1, 2015. Mr. Kirk has been Group Chief Executi ...


CEO Compensation Analysis

Compensation vs Market: Ian's total compensation ($USD0.00) is below average for companies of similar size in the ZA market ($USD2.23M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Ian Kirk
Group CEO & Executive Director4.92yrsR22.52m0.016% ZAR20.0m
Temba Mvusi
Executive Director11.42yrsR8.28m0.0074% ZAR9.5m
Heinie Werth
CEO of Sanlam Emerging Markets & Executive Director3.67yrsR12.22m0.040% ZAR51.0m
Anton Gildenhuys
Chief Actuary & Group Risk Officer5.42yrsR10.26mno data
Lizé Lambrechts
Chief Executive Officer of Santam Limited5.42yrsR13.30mno data
Robert Roux
Chief Executive Officer of Sanlam Investments Managementno dataR17.07mno data
Wikus Olivier
Interim Chief Financial Officer0.92yrno datano data
Ainsley Moos
Head of Group Communications and Operations Manager of Group Chief Executive Officer's Office7.75yrsno datano data
Jeanett Modise
Chief Executive of Human Resources & Executive Director0.75yrno datano data
Danie Claassen
Head of Group Tax Servicesno datano datano data

5.2yrs

Average Tenure

55.5yo

Average Age

Experienced Management: SLM's management team is seasoned and experienced (5.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ian Kirk
Group CEO & Executive Director4.92yrsR22.52m0.016% ZAR20.0m
Temba Mvusi
Executive Director11.42yrsR8.28m0.0074% ZAR9.5m
Heinie Werth
CEO of Sanlam Emerging Markets & Executive Director3.67yrsR12.22m0.040% ZAR51.0m
Jeanett Modise
Chief Executive of Human Resources & Executive Director0.75yrno datano data
Anton Botha
Independent Non-Executive Director14.42yrsR1.43mno data
Sipho Nkosi
Lead Independent Non-Executive Director3.5yrsR452.00kno data
Patrice Motsepe
Deputy Chairmanno dataR832.00kno data
Christiaan Swanepoel
Independent Non-Executive Director9.42yrsR3.04mno data
Johan van Zyl
Non Independent & Non-Executive Chairman of the Board3yrsR1.13mno data
Junior Ngulube
Vice Chairman of Sanlam Pan Africa0.83yrR10.89mno data

3.7yrs

Average Tenure

62yo

Average Age

Experienced Board: SLM's board of directors are considered experienced (3.7 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

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


Key Information

  • Name: Sanlam Limited
  • Ticker: SLM
  • Exchange: JSE
  • Founded: 1918
  • Industry: Life and Health Insurance
  • Sector: Insurance
  • Market Cap: R128.302b
  • Shares outstanding: 2.07b
  • Website: https://www.sanlam.co.za

Number of Employees


Location

  • Sanlam Limited
  • 2 Strand Road
  • Bellville
  • Western Cape
  • 7530
  • South Africa

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SLMA.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDNov 1998
SLMJSE (The Johannesburg Securities Exchange)YesOrdinary SharesZAZARNov 1998
SLANMSE (Namibian Stock Exchange)YesOrdinary SharesNAZARNov 1998
LA6ADB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 1998
SLLD.YOTCPK (Pink Sheets LLC)SPONSORED ADRUSUSDMar 2009

Biography

Sanlam Limited provides various financial solutions to individual, business, and institutional clients. The company operates through Sanlam Personal Finance, Sanlam Emerging Markets, Sanlam Investment Group, Sanlam Corporate, and Santam segments. It offers life, disability cover, income protection, severe illness, medical, short-term, and group risk benefits insurances; financial planning and retirement solutions; investment products; wealth, and professionals and graduates insurance services; and personal loans. The company also provides business advice, business continuity and risk management, and employee health and retirement plans for small and medium businesses, and self-employed professionals. It operates primarily in South Africa, rest of Africa, and internationally. Sanlam Limited was founded in 1918 and is headquartered in Bellville, South Africa. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/06 20:27
End of Day Share Price2020/06/05 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.