American Equity Investment Life Holding Company (NYSE:AEL) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of AEL, it is a well-regarded dividend-paying company with a a strong history of performance, trading at a great value. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, read the full report on American Equity Investment Life Holding here.
Good value with proven track record and pays a dividend
AEL delivered a triple-digit bottom-line expansion over the past couple of years, with its most recent earnings level surpassing its average level over the last five years. Not only did AEL outperformed its past performance, its growth also surpassed the Insurance industry expansion, which generated a 2.2% earnings growth. This paints a buoyant picture for the company. AEL is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of AEL’s earnings, investors now have the opportunity to buy into the stock to reap capital gains. Compared to the rest of the insurance industry, AEL is also trading below its peers, relative to earnings generated. This supports the theory that AEL is potentially underpriced.
For those seeking income streams from their portfolio, AEL is a robust dividend payer as well. Over the past decade, the company has consistently increased its dividend payout, reaching a yield of 0.9%.
For American Equity Investment Life Holding, there are three essential factors you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for AEL’s future growth? Take a look at our free research report of analyst consensus for AEL’s outlook.
- Financial Health: Are AEL’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of AEL? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.