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FANHUA INC-SPONSORED ADR (FANH) Stock Fundamental Analysis

NASDAQ:FANH - Nasdaq - US30712A1034 - ADR - Currency: USD

1.53  -0.02 (-1.29%)

Fundamental Rating

5

We assign a fundamental rating of 5 out of 10 to FANH. FANH was compared to 143 industry peers in the Insurance industry. FANH is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. FANH has a valuation in line with the averages, but on the other hand it scores bad on growth.


Dividend Valuation Growth Profitability Health

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6

1. Profitability

1.1 Basic Checks

In the past year FANH was profitable.
FANH had a positive operating cash flow in the past year.
FANH had positive earnings in each of the past 5 years.
Each year in the past 5 years FANH had a positive operating cash flow.
FANH Yearly Net Income VS EBIT VS OCF VS FCFFANH Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 200M 400M 600M

1.2 Ratios

The Return On Assets of FANH (7.34%) is better than 92.81% of its industry peers.
With a decent Return On Equity value of 13.45%, FANH is doing good in the industry, outperforming 64.75% of the companies in the same industry.
With an excellent Return On Invested Capital value of 5.14%, FANH belongs to the best of the industry, outperforming 85.61% of the companies in the same industry.
FANH had an Average Return On Invested Capital over the past 3 years of 7.25%. This is above the industry average of 4.07%.
Industry RankSector Rank
ROA 7.34%
ROE 13.45%
ROIC 5.14%
ROA(3y)5.97%
ROA(5y)6.42%
ROE(3y)11.13%
ROE(5y)11.56%
ROIC(3y)7.25%
ROIC(5y)9.68%
FANH Yearly ROA, ROE, ROICFANH Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 5 10 15 20

1.3 Margins

FANH has a Profit Margin of 8.77%. This is comparable to the rest of the industry: FANH outperforms 56.83% of its industry peers.
FANH's Profit Margin has declined in the last couple of years.
FANH has a Operating Margin of 6.12%. This is in the lower half of the industry: FANH underperforms 64.03% of its industry peers.
FANH's Operating Margin has declined in the last couple of years.
FANH has a better Gross Margin (32.92%) than 92.09% of its industry peers.
In the last couple of years the Gross Margin of FANH has remained more or less at the same level.
Industry RankSector Rank
OM 6.12%
PM (TTM) 8.77%
GM 32.92%
OM growth 3Y-12.84%
OM growth 5Y-12.97%
PM growth 3Y2.22%
PM growth 5Y-12.98%
GM growth 3Y0.68%
GM growth 5Y0.4%
FANH Yearly Profit, Operating, Gross MarginsFANH Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 10 20 30

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7

2. Health

2.1 Basic Checks

FANH has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, FANH has more shares outstanding
FANH has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, FANH has a worse debt to assets ratio.
FANH Yearly Shares OutstandingFANH Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 20M 40M 60M
FANH Yearly Total Debt VS Total AssetsFANH Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 1B 2B 3B 4B

2.2 Solvency

An Altman-Z score of 2.34 indicates that FANH is not a great score, but indicates only limited risk for bankruptcy at the moment.
With an excellent Altman-Z score value of 2.34, FANH belongs to the best of the industry, outperforming 93.53% of the companies in the same industry.
FANH has a debt to FCF ratio of 1.12. This is a very positive value and a sign of high solvency as it would only need 1.12 years to pay back of all of its debts.
The Debt to FCF ratio of FANH (1.12) is better than 62.59% of its industry peers.
A Debt/Equity ratio of 0.05 indicates that FANH is not too dependend on debt financing.
The Debt to Equity ratio of FANH (0.05) is better than 86.33% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.05
Debt/FCF 1.12
Altman-Z 2.34
ROIC/WACC0.69
WACC7.48%
FANH Yearly LT Debt VS Equity VS FCFFANH Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 1B 2B 3B

2.3 Liquidity

FANH has a Current Ratio of 2.59. This indicates that FANH is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of FANH (2.59) is better than 94.24% of its industry peers.
A Quick Ratio of 2.59 indicates that FANH has no problem at all paying its short term obligations.
FANH has a better Quick ratio (2.59) than 94.24% of its industry peers.
Industry RankSector Rank
Current Ratio 2.59
Quick Ratio 2.59
FANH Yearly Current Assets VS Current LiabilitesFANH Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 1B 2B 3B 4B

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3

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 189.43% over the past year.
FANH shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -11.87% yearly.
The Revenue has grown by 14.98% in the past year. This is quite good.
Measured over the past years, FANH shows a decrease in Revenue. The Revenue has been decreasing by -1.62% on average per year.
EPS 1Y (TTM)189.43%
EPS 3Y1.38%
EPS 5Y-11.87%
EPS Q2Q%-93.67%
Revenue 1Y (TTM)14.98%
Revenue growth 3Y-0.72%
Revenue growth 5Y-1.62%
Sales Q2Q%-0.83%

3.2 Future

The Earnings Per Share is expected to decrease by -8.88% on average over the next years.
Based on estimates for the next years, FANH will show a decrease in Revenue. The Revenue will decrease by -6.76% on average per year.
EPS Next Y-25.89%
EPS Next 2Y-8.88%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-22.25%
Revenue Next 2Y-6.76%
Revenue Next 3YN/A
Revenue Next 5YN/A

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
FANH Yearly Revenue VS EstimatesFANH Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1B 2B 3B 4B
FANH Yearly EPS VS EstimatesFANH Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0.2 0.4 0.6 0.8 1

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6

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 2.22, the valuation of FANH can be described as very cheap.
Compared to the rest of the industry, the Price/Earnings ratio of FANH indicates a rather cheap valuation: FANH is cheaper than 87.77% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of FANH to the average of the S&P500 Index (26.35), we can say FANH is valued rather cheaply.
FANH is valuated cheaply with a Price/Forward Earnings ratio of 2.83.
FANH's Price/Forward Earnings ratio is rather cheap when compared to the industry. FANH is cheaper than 84.17% of the companies in the same industry.
FANH's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.19.
Industry RankSector Rank
PE 2.22
Fwd PE 2.83
FANH Price Earnings VS Forward Price EarningsFANH Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40

4.2 Price Multiples

FANH's Price/Free Cash Flow ratio is in line with the industry average.
Industry RankSector Rank
P/FCF 7
EV/EBITDA -3.19
FANH Per share dataFANH EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6

4.3 Compensation for Growth

FANH has a very decent profitability rating, which may justify a higher PE ratio.
A cheap valuation may be justified as FANH's earnings are expected to decrease with -8.88% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-8.88%
EPS Next 3YN/A

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0

5. Dividend

5.1 Amount

FANH does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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FANHUA INC-SPONSORED ADR

NASDAQ:FANH (10/22/2024, 8:15:50 PM)

1.53

-0.02 (-1.29%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)09-18 2024-09-18/bmo
Earnings (Next)11-18 2024-11-18/bmo
Inst Owners4.37%
Inst Owner Change-3.72%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap86.76M
Analysts43.33
Price Target6.12 (300%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
Industry RankSector Rank
PE 2.22
Fwd PE 2.83
P/S 0.19
P/FCF 7
P/OCF 6.1
P/B 0.3
P/tB 0.37
EV/EBITDA -3.19
EPS(TTM)0.69
EY45.1%
EPS(NY)0.54
Fwd EY35.37%
FCF(TTM)0.22
FCFY14.28%
OCF(TTM)0.25
OCFY16.39%
SpS7.93
BVpS5.17
TBVpS4.13
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 7.34%
ROE 13.45%
ROCE 6.55%
ROIC 5.14%
ROICexc 6.85%
ROICexgc 8.38%
OM 6.12%
PM (TTM) 8.77%
GM 32.92%
FCFM 2.76%
ROA(3y)5.97%
ROA(5y)6.42%
ROE(3y)11.13%
ROE(5y)11.56%
ROIC(3y)7.25%
ROIC(5y)9.68%
ROICexc(3y)15.75%
ROICexc(5y)28.34%
ROICexgc(3y)18.36%
ROICexgc(5y)33.72%
ROCE(3y)9.1%
ROCE(5y)12.03%
ROICexcg growth 3Y-37.7%
ROICexcg growth 5Y-28.74%
ROICexc growth 3Y-39.39%
ROICexc growth 5Y-30.05%
OM growth 3Y-12.84%
OM growth 5Y-12.97%
PM growth 3Y2.22%
PM growth 5Y-12.98%
GM growth 3Y0.68%
GM growth 5Y0.4%
F-Score8
Asset Turnover0.84
Health
Industry RankSector Rank
Debt/Equity 0.05
Debt/FCF 1.12
Debt/EBITDA 0.43
Cap/Depr N/A
Cap/Sales N/A
Interest Coverage 250
Cash Conversion 43.99%
Profit Quality 31.42%
Current Ratio 2.59
Quick Ratio 2.59
Altman-Z 2.34
F-Score8
WACC7.48%
ROIC/WACC0.69
Cap/Depr(3y)201.65%
Cap/Depr(5y)160.89%
Cap/Sales(3y)1.38%
Cap/Sales(5y)1.03%
Profit Quality(3y)43.2%
Profit Quality(5y)71.56%
High Growth Momentum
Growth
EPS 1Y (TTM)189.43%
EPS 3Y1.38%
EPS 5Y-11.87%
EPS Q2Q%-93.67%
EPS Next Y-25.89%
EPS Next 2Y-8.88%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)14.98%
Revenue growth 3Y-0.72%
Revenue growth 5Y-1.62%
Sales Q2Q%-0.83%
Revenue Next Year-22.25%
Revenue Next 2Y-6.76%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y16.08%
EBIT growth 3Y-13.47%
EBIT growth 5Y-14.38%
EBIT Next Year-0.95%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y80.57%
FCF growth 3Y-38.78%
FCF growth 5Y-29.25%
OCF growth 1Y107.2%
OCF growth 3Y-36.75%
OCF growth 5Y-27.94%