We assign a fundamental rating of 4 out of 10 to HMN. HMN was compared to 148 industry peers in the Insurance industry. HMN may be in some trouble as it scores bad on both profitability and health. HMN may be a bit undervalued, certainly considering the very reasonable score on growth Finally HMN also has an excellent dividend rating.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

HMN had positive earnings in the past year.
HMN had a positive operating cash flow in the past year.
HMN had positive earnings in 4 of the past 5 years.
In the past 5 years HMN always reported a positive cash flow from operatings.

1.2 Ratios

With a Return On Assets value of 1.06%, HMN is not doing good in the industry: 61.49% of the companies in the same industry are doing better.
HMN's Return On Equity of 11.39% is in line compared to the rest of the industry. HMN outperforms 52.70% of its industry peers.

		Industry Rank	Sector Rank
ROA	1.06%
ROE	11.39%
ROIC	N/A

ROA(3y)0.34%

ROA(5y)0.6%

ROE(3y)3.86%

ROE(5y)5.39%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

The Profit Margin of HMN (9.79%) is better than 61.49% of its industry peers.
HMN's Profit Margin has declined in the last couple of years.
With a decent Operating Margin value of 14.25%, HMN is doing good in the industry, outperforming 60.14% of the companies in the same industry.
HMN's Operating Margin has declined in the last couple of years.

		Industry Rank	Sector Rank
OM	14.25%
PM (TTM)	9.79%
GM	N/A

OM growth 3Y-12.94%

OM growth 5Y-12.98%

PM growth 3Y-15.29%

PM growth 5Y-12.85%

GM growth 3YN/A

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

HMN does not have a ROIC to compare to the WACC, probably because it is not profitable.
The number of shares outstanding for HMN remains at a similar level compared to 1 year ago.
Compared to 5 years ago, HMN has less shares outstanding
The debt/assets ratio for HMN has been reduced compared to a year ago.

2.2 Solvency

The Debt to FCF ratio of HMN is 1.37, which is an excellent value as it means it would take HMN, only 1.37 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of HMN (1.37) is better than 61.49% of its industry peers.
HMN has a Debt/Equity ratio of 0.58. This is a neutral value indicating HMN is somewhat dependend on debt financing.
HMN has a worse Debt to Equity ratio (0.58) than 75.68% of its industry peers.
Although HMN does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

		Industry Rank	Sector Rank
Debt/Equity	0.58
Debt/FCF	1.37
Altman-Z	N/A

ROIC/WACCN/A

WACC7.99%

2.3 Liquidity

		Industry Rank	Sector Rank
Current Ratio	N/A
Quick Ratio	N/A

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

HMN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 113.33%, which is quite impressive.
The Earnings Per Share has been growing slightly by 7.81% on average over the past years.
HMN shows a small growth in Revenue. In the last year, the Revenue has grown by 5.66%.
Measured over the past years, HMN shows a small growth in Revenue. The Revenue has been growing by 2.09% on average per year.

EPS 1Y (TTM)113.33%

EPS 3Y-3.86%

EPS 5Y7.81%

EPS Q2Q%78.95%

Revenue 1Y (TTM)5.66%

Revenue growth 3Y5.8%

Revenue growth 5Y2.09%

Sales Q2Q%7.58%

3.2 Future

HMN is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 18.21% yearly.
HMN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.08% yearly.

EPS Next Y49.2%

EPS Next 2Y21.6%

EPS Next 3Y18.21%

EPS Next 5YN/A

Revenue Next Year5.98%

Revenue Next 2Y6.22%

Revenue Next 3Y5.08%

Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 8.75, the valuation of HMN can be described as very reasonable.
Based on the Price/Earnings ratio, HMN is valued a bit cheaper than 70.27% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.30. HMN is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio of 9.50, the valuation of HMN can be described as reasonable.
Based on the Price/Forward Earnings ratio, HMN is valued a bit cheaper than 60.81% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of HMN to the average of the S&P500 Index (25.57), we can say HMN is valued rather cheaply.

		Industry Rank	Sector Rank
PE	8.75
Fwd PE	9.5

4.2 Price Multiples

HMN's Enterprise Value to EBITDA ratio is in line with the industry average.
HMN's Price/Free Cash Flow ratio is rather cheap when compared to the industry. HMN is cheaper than 83.78% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	2.96
EV/EBITDA	9.74

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
HMN's earnings are expected to grow with 18.21% in the coming years. This may justify a more expensive valuation.

PEG (NY)0.18

PEG (5Y)1.12

EPS Next 2Y21.6%

EPS Next 3Y18.21%

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5. Dividend

5.1 Amount

HMN has a Yearly Dividend Yield of 3.23%.
HMN's Dividend Yield is a higher than the industry average which is at 2.41.
Compared to an average S&P500 Dividend Yield of 1.82, HMN pays a better dividend.

		Industry Rank	Sector Rank
Dividend Yield	3.23%

5.2 History

The dividend of HMN has a limited annual growth rate of 3.32%.
HMN has been paying a dividend for at least 10 years, so it has a reliable track record.
HMN has not decreased their dividend for at least 10 years, which is a reliable track record.

Dividend Growth(5Y)3.32%

Div Incr Years15

Div Non Decr Years15

5.3 Sustainability

34.55% of the earnings are spent on dividend by HMN. This is a low number and sustainable payout ratio.
The dividend of HMN is growing, but earnings are growing more, so the dividend growth is sustainable.

DP34.55%

EPS Next 2Y21.6%

EPS Next 3Y18.21%

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HORACE MANN EDUCATORS / HMN FAQ

What is the ChartMill fundamental rating of HORACE MANN EDUCATORS (HMN) stock?

ChartMill assigns a fundamental rating of 4 / 10 to HMN.

What is the valuation status of HORACE MANN EDUCATORS (HMN) stock?

ChartMill assigns a valuation rating of 7 / 10 to HORACE MANN EDUCATORS (HMN). This can be considered as Undervalued.

What is the profitability of HMN stock?

HORACE MANN EDUCATORS (HMN) has a profitability rating of 3 / 10.

What are the PE and PB ratios of HORACE MANN EDUCATORS (HMN) stock?

The Price/Earnings (PE) ratio for HORACE MANN EDUCATORS (HMN) is 8.75 and the Price/Book (PB) ratio is 1.26.

What is the earnings growth outlook for HORACE MANN EDUCATORS?

The Earnings per Share (EPS) of HORACE MANN EDUCATORS (HMN) is expected to grow by 49.2% in the next year.