Fundamental Analysis: ALLSTATE (#ALL)

The Allstate Corporation is an American insurance company, headquartered in Northfield Township, Illinois, near Northbrook since 1967. Founded in 1931 as part of Sears, Roebuck and Co., it was spun off in 1993. The company also has personal lines insurance operations in Canada.j


💡Allstate #ALL insurance company receives a “buy” rating from analysts after the takeover and sale of a number of companies. J.P. Morgan believes Allstate has significant growth potential and an acceptable valuation right now.


👉🏻 According to analysts, the most important factor for growth is the reduction of residual risk due to the fact that the company has intensified and sold most of its life insurance and annuities.


⬆️ Three key drivers of growth:


👉🏻 Allstate relies on a closed market with a high cost ratio, yet generates profits at the level of the most successful companies through strict pricing policies and sound risk management.


👉🏻 Selling 80% of the life insurance franchise and annuities lowers the company's book value by 12%, but should improve the risk profile, making the company less susceptible to low rates.

In addition the company is planning to expand its plans to appliances and furnitures.


👉🏻 The segment of value-added services maintains a trend towards higher growth rates. #ALL is currently trading at a P / BV multiple of 1.3x BV. The indicator is close to the sector average despite the significantly higher return on equity of the company.


On a longer time frame, the stock is given a fair value of $ 231.31 which results in a 53% discount to current value.


✅Allstate #ALL

🎯Target price - 127 $, growth potential + 18.8%


💎 Allstate has a low score with strong fundamentals and maintains very high margins. The company's shares have every chance of outstripping growth. We keep the company's shares in the portfolio.

OTB Global Investments

London, 10 February 2021

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