Axis Capital Holdings (AXS:NYS) Fundamental Valuation Report


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Axis Capital Holdings $48.02 (USD) Close Price as of 02/03/2018

Based on the analysis conducted in this report, Axis Capital Holdings, (AXS:NYS) is found to be  Undervalued.

Company Axis Capital Holdings
Symbol:Exchange AXS:NYS
Industry Financial Services:Insurance-Property & Casualty
Close Price/Date $48.02 (USD) 02/03/2018
Weighted Average Valuation $54.88 (USD)
Summary AXS:NYS is found to be  Undervalued by 14.3% using the 3 valuation models shown below.
Valuation Models Used Analyst Consensus: $53.50 (USD)
(in order of importance) Adjusted Book Value: $53.97 (USD)
Comparables: $60.85 (USD)
Valuation Methods Analysis This company is:
Cash Flow Basis: Undervalued on a Cash Flow Valuation basis
Comparable Company Basis: Undervalued on a Comparable Valuation basis
Asset Basis: Undervalued on an Asset Valuation basis

Valuation Details

Axis Capital Holdings Valuations

Summary chart

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for AXS:NYS

Using a discounted cash flow model we generated an intrinsic value of $73.46 (USD) for AXS:NYS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

AXS:NYS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $73.46 1% 5% 1% 5%
WACC (or Ke) 8.45 $91.76 $60.85
Terminal Growth Rate 3.00 $62.08 $89.97
Tax Rate 0.02 $77.60 $69.33
Cash Flow 411,394,704 $69.41 $77.51
Capital Expenditures 0 $73.46 $73.46
Long Term Debt 0 $73.46 $73.46

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $45.72 (USD) for AXS:NYS. We also generated a valuation of $60.85 (USD) using other metrics and comparables.
The comparable companies were Argo Group Intl Hldgs (AGII:NAS), White Mountains Insurance (WTM:NYS) and XL Group (XL:NYS)

Company AXS:NYS End Date Value
Cash/Share $11.28 (USD)
Book Value/Share $54.86 (USD)
MarketCap 3,996,648,368
1 Year Return -0.316
NetPPE 0
Price Based on Comps Adjustment Factor (%)
$0.00 (USD) 0
$52.79 (USD) 0
$63.79 (USD) 0
$65.98 (USD) 0
$0.00 (USD) 0
Ratios Used Average Values AGII:NAS WTM:NYS XL:NYS
Cash / Share 6.24 5.75 0.00 12.96
Book Value / Share 316.23 61.14 846.45 41.10
Market Cap 5,365,555,354 1,856,620,460 3,678,581,549 10,561,464,053
1 Year Return -0.06 -0.14 -0.13 0.07
Net PPE 0 0 0 0

Multiples

Using a multiples approach we generated a valuation of  $49.99 (USD) for AXS:NYS

Company AXS:NYS End Date Value
Earnings/Share ($4.94) (USD)
Book Value/Share $54.86 (USD)
Sales/Share $54.59 (USD)
Cash Flow/Share $3.08 (USD)
EBITDA/Share ($3.69) (USD)
Price Based on Comps Adjustment Factor
$0.00 (USD) 0
$54.47 (USD) 0
$71.41 (USD) 0
$24.09 (USD) 0
$0.00 (USD) 0
Ratios Ratio Average
PE Ratio 9.62
PB Ratio 0.99
PS Ratio 1.31
PCF Ratio 7.82
EV to EBITDA 6.59

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  AXS:NYS for the last 10 years was  0.98

We ran the Adjusted Book Value for  AXS:NYS and generated a book value of  $54.91 (USD)
By multiplying these we get an adjusted valuation of  $53.97 (USD)

Analyst Data

In the Stockcalc database there are 2 analysts that provide a valuation for AXS:NYS. The 2 analysts have a concensus valuation for AXS:NYS for 2018 of $53.50 (USD).

AXS:NYS Axis Capital Holdings

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
0 2 0 3.0000 Hold 2018-3-1

Current Price: not available

Analyst Consensus
USD Millions 2018 2019 2020
Mean EPS 4.16 4.88 5.36
# EPS Analysts 2 2 1
Mean Revenue 5,017.20 5,195.90 5,608.90
# Revenue Analysts 1 1 1
Mean Target Price 53.50
Mean Cash Flow
Mean EBITDA
Mean Net Income 312.30 359.90 435.40
Mean Debt Outstanding
Mean Tax Rate
Mean Growth Rate
Mean Capital Expenditure

Company Overview (AXS:NYS USD)

Price 48.02
Range 47.43 – 48.27
52 week 47.86 – 68.94
Open 47.66
Vol / Avg. 743676/720761
Mkt cap 3.99B
P/E 0.00
Div/yield 1.56/0.03
EPS -4.94
Shares 83.16M
Beta 0.75
Summary chart

Detailed Company Description

Axis Capital Holdings Ltd is a global property and casualty insurance company. The firm along with its subsidiaries provides its clients and distribution partners with various products and services around the world.

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.
The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).
The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.
We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.
Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.
With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.
If we have Analyst coverage for the company we use the consensus target price here.

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