DEFINITY FINANCIAL CORP (DFY.CA) Stock Fundamental Analysis
TSX:DFY - Toronto Stock Exchange - CA24477T1003 - Common Stock - Currency: CAD
Overall DFY gets a fundamental rating of 6 out of 10. We evaluated DFY against 82 industry peers in the Insurance industry. Both the health and profitability get an excellent rating, making DFY a very profitable company, without any liquidiy or solvency issues. DFY is valued quite expensively, but it does show have an excellent growth rating. These ratings could make DFY a good candidate for growth and quality investing.
1. Profitability
1.1 Basic Checks
DFY had positive earnings in the past year.
In the past year DFY had a positive cash flow from operations.
Each year in the past 5 years DFY has been profitable.
Each year in the past 5 years DFY had a positive operating cash flow.
1.2 Ratios
DFY has a Return On Assets of 5.36%. This is amongst the best in the industry. DFY outperforms 100.00% of its industry peers.
DFY has a Return On Equity of 12.39%. This is amongst the best in the industry. DFY outperforms 86.08% of its industry peers.
DFY has a better Return On Invested Capital (7.19%) than 98.73% of its industry peers.
The Average Return On Invested Capital over the past 3 years for DFY is above the industry average of 2.73%.
The last Return On Invested Capital (7.19%) for DFY is above the 3 year average (5.57%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.36% | ||
| ROE | 12.39% | ||
| ROIC | 7.19% |
ROA(3y)4.01%
ROA(5y)3.53%
ROE(3y)9.87%
ROE(5y)9.28%
ROIC(3y)5.57%
ROIC(5y)4.57%
1.3 Margins
DFY has a Profit Margin of 9.26%. This is comparable to the rest of the industry: DFY outperforms 54.43% of its industry peers.
DFY's Profit Margin has improved in the last couple of years.
DFY has a Operating Margin of 16.29%. This is in the better half of the industry: DFY outperforms 68.35% of its industry peers.
In the last couple of years the Operating Margin of DFY has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.29% | ||
| PM (TTM) | 9.26% | ||
| GM | N/A |
OM growth 3Y15.85%
OM growth 5Y74.28%
PM growth 3Y10.09%
PM growth 5Y69.91%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), DFY is destroying value.
The number of shares outstanding for DFY has been reduced compared to 1 year ago.
DFY has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, DFY has an improved debt to assets ratio.
2.2 Solvency
DFY has an Altman-Z score of 2.26. This is not the best score and indicates that DFY is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.26, DFY belongs to the top of the industry, outperforming 98.73% of the companies in the same industry.
DFY has a debt to FCF ratio of 0.48. This is a very positive value and a sign of high solvency as it would only need 0.48 years to pay back of all of its debts.
DFY has a better Debt to FCF ratio (0.48) than 98.73% of its industry peers.
DFY has a Debt/Equity ratio of 0.04. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.04, DFY belongs to the top of the industry, outperforming 98.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.04 | ||
| Debt/FCF | 0.48 | ||
| Altman-Z | 2.26 |
ROIC/WACC0.94
WACC7.68%
2.3 Liquidity
DFY has a Current Ratio of 0.69. This is a bad value and indicates that DFY is not financially healthy enough and could expect problems in meeting its short term obligations.
DFY has a better Current ratio (0.69) than 91.14% of its industry peers.
A Quick Ratio of 0.69 indicates that DFY may have some problems paying its short term obligations.
DFY's Quick ratio of 0.69 is amongst the best of the industry. DFY outperforms 91.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.69 | ||
| Quick Ratio | 0.69 |
3. Growth
3.1 Past
DFY shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 20.27%, which is quite impressive.
DFY shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 89.77% yearly.
DFY shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.34%.
Measured over the past years, DFY shows a quite strong growth in Revenue. The Revenue has been growing by 11.80% on average per year.
EPS 1Y (TTM)20.27%
EPS 3Y22.24%
EPS 5Y89.77%
EPS Q2Q%0%
Revenue 1Y (TTM)10.34%
Revenue growth 3Y14.8%
Revenue growth 5Y11.8%
Sales Q2Q%12.1%
3.2 Future
The Earnings Per Share is expected to grow by 14.52% on average over the next years. This is quite good.
The Revenue is expected to grow by 9.58% on average over the next years. This is quite good.
EPS Next Y22.15%
EPS Next 2Y16.28%
EPS Next 3Y14.52%
EPS Next 5YN/A
Revenue Next Year6.88%
Revenue Next 2Y6.59%
Revenue Next 3Y9.58%
Revenue Next 5YN/A
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
DFY is valuated quite expensively with a Price/Earnings ratio of 27.91.
Compared to the rest of the industry, the Price/Earnings ratio of DFY indicates a rather expensive valuation: DFY more expensive than 97.47% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of DFY to the average of the S&P500 Index (26.25), we can say DFY is valued inline with the index average.
With a Price/Forward Earnings ratio of 20.64, DFY is valued on the expensive side.
Based on the Price/Forward Earnings ratio, DFY is valued a bit more expensive than 70.89% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of DFY to the average of the S&P500 Index (22.15), we can say DFY is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.91 | ||
| Fwd PE | 20.64 |
4.2 Price Multiples
Compared to the rest of the industry, the Price/Free Cash Flow ratio of DFY indicates a rather expensive valuation: DFY more expensive than 96.20% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.1 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of DFY may justify a higher PE ratio.
A more expensive valuation may be justified as DFY's earnings are expected to grow with 14.52% in the coming years.
PEG (NY)1.26
PEG (5Y)0.31
EPS Next 2Y16.28%
EPS Next 3Y14.52%
5. Dividend
5.1 Amount
DFY has a yearly dividend return of 1.00%, which is pretty low.
With a Dividend Yield of 1.00, DFY pays less dividend than the industry average, which is at 4.24. 82.28% of the companies listed in the same industry pay a better dividend than DFY!
With a Dividend Yield of 1.00, DFY pays less dividend than the S&P500 average, which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1% |
5.2 History
DFY has paid a dividend for less than 5 years, so there is no long track record yet.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years2
5.3 Sustainability
DFY pays out 18.29% of its income as dividend. This is a sustainable payout ratio.
DP18.29%
EPS Next 2Y16.28%
EPS Next 3Y14.52%
TSX:DFY (5/30/2025, 7:00:00 PM)
74.52
-0.53 (-0.71%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners66.78%
Inst Owner ChangeN/A
Ins Owners0.79%
Ins Owner ChangeN/A
Market Cap8.63B
Analysts66.67
Price Target66.5 (-10.76%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1% |
Yearly Dividend0.64
Dividend Growth(5Y)N/A
DP18.29%
Div Incr Years1
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.49%
Min EPS beat(2)-6.77%
Max EPS beat(2)5.79%
EPS beat(4)3
Avg EPS beat(4)1020.84%
Min EPS beat(4)-6.77%
Max EPS beat(4)4036.17%
EPS beat(8)6
Avg EPS beat(8)580.22%
EPS beat(12)9
Avg EPS beat(12)392.21%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)4.09%
Min Revenue beat(2)2.86%
Max Revenue beat(2)5.33%
Revenue beat(4)4
Avg Revenue beat(4)3.57%
Min Revenue beat(4)1.91%
Max Revenue beat(4)5.33%
Revenue beat(8)8
Avg Revenue beat(8)3.43%
Revenue beat(12)9
Avg Revenue beat(12)1.34%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)2.59%
PT rev (3m)2.35%
EPS NQ rev (1m)1.08%
EPS NQ rev (3m)-2.27%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.17%
Revenue NQ rev (1m)-2.94%
Revenue NQ rev (3m)-4.13%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.91 | ||
| Fwd PE | 20.64 | ||
| P/S | 1.92 | ||
| P/FCF | 28.1 | ||
| P/OCF | 22.52 | ||
| P/B | 2.56 | ||
| P/tB | 4.49 | ||
| EV/EBITDA | N/A |
EPS(TTM)2.67
EY3.58%
EPS(NY)3.61
Fwd EY4.84%
FCF(TTM)2.65
FCFY3.56%
OCF(TTM)3.31
OCFY4.44%
SpS38.9
BVpS29.08
TBVpS16.59
PEG (NY)1.26
PEG (5Y)0.31
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.36% | ||
| ROE | 12.39% | ||
| ROCE | 9.52% | ||
| ROIC | 7.19% | ||
| ROICexc | 7.33% | ||
| ROICexgc | 9.72% | ||
| OM | 16.29% | ||
| PM (TTM) | 9.26% | ||
| GM | N/A | ||
| FCFM | 6.82% |
ROA(3y)4.01%
ROA(5y)3.53%
ROE(3y)9.87%
ROE(5y)9.28%
ROIC(3y)5.57%
ROIC(5y)4.57%
ROICexc(3y)5.78%
ROICexc(5y)4.81%
ROICexgc(3y)7.49%
ROICexgc(5y)5.93%
ROCE(3y)7.42%
ROCE(5y)6.09%
ROICexcg growth 3Y32.47%
ROICexcg growth 5Y94.14%
ROICexc growth 3Y23.54%
ROICexc growth 5Y85.7%
OM growth 3Y15.85%
OM growth 5Y74.28%
PM growth 3Y10.09%
PM growth 5Y69.91%
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover0.58
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.04 | ||
| Debt/FCF | 0.48 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | 1.69% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | N/A | ||
| Profit Quality | 73.63% | ||
| Current Ratio | 0.69 | ||
| Quick Ratio | 0.69 | ||
| Altman-Z | 2.26 |
F-Score7
WACC7.68%
ROIC/WACC0.94
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)2.23%
Cap/Sales(5y)2%
Profit Quality(3y)107.72%
Profit Quality(5y)179.61%
High Growth Momentum
Growth
EPS 1Y (TTM)20.27%
EPS 3Y22.24%
EPS 5Y89.77%
EPS Q2Q%0%
EPS Next Y22.15%
EPS Next 2Y16.28%
EPS Next 3Y14.52%
EPS Next 5YN/A
Revenue 1Y (TTM)10.34%
Revenue growth 3Y14.8%
Revenue growth 5Y11.8%
Sales Q2Q%12.1%
Revenue Next Year6.88%
Revenue Next 2Y6.59%
Revenue Next 3Y9.58%
Revenue Next 5YN/A
EBIT growth 1Y16.44%
EBIT growth 3Y32.99%
EBIT growth 5Y94.85%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y41.24%
FCF growth 3Y-27.42%
FCF growth 5Y14.99%
OCF growth 1Y24.21%
OCF growth 3Y-22.31%
OCF growth 5Y17.27%