MERCURY GENERAL CORP (MCY)
US5894001008 - Common Stock
Overall MCY gets a fundamental rating of 5 out of 10. We evaluated MCY against 141 industry peers in the Insurance industry. MCY has an average financial health and profitability rating. MCY may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
In the past year MCY was profitable.
In the past year MCY had a positive cash flow from operations.
Of the past 5 years MCY 4 years were profitable.
In the past 5 years MCY always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 4.13%, MCY is in the better half of the industry, outperforming 79.14% of the companies in the same industry.
The Return On Equity of MCY (19.36%) is better than 79.14% of its industry peers.
With a decent Return On Invested Capital value of 4.38%, MCY is doing good in the industry, outperforming 77.70% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.13% | ||
| ROE | 19.36% | ||
| ROIC | 4.38% |
ROA(3y)-0.95%
ROA(5y)1.7%
ROE(3y)-5.29%
ROE(5y)4.07%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Profit Margin, with a value of 6.36%, MCY is in line with its industry, outperforming 49.64% of the companies in the same industry.
In the last couple of years the Profit Margin of MCY has declined.
MCY has a Operating Margin of 8.29%. This is comparable to the rest of the industry: MCY outperforms 46.04% of its industry peers.
MCY's Operating Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.29% | ||
| PM (TTM) | 6.36% | ||
| GM | N/A |
OM growth 3Y-40.33%
OM growth 5YN/A
PM growth 3Y-40.54%
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so MCY is destroying value.
The number of shares outstanding for MCY remains at a similar level compared to 1 year ago.
The number of shares outstanding for MCY remains at a similar level compared to 5 years ago.
Compared to 1 year ago, MCY has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.42, we must say that MCY is in the distress zone and has some risk of bankruptcy.
MCY has a better Altman-Z score (1.42) than 87.05% of its industry peers.
The Debt to FCF ratio of MCY is 0.74, which is an excellent value as it means it would take MCY, only 0.74 years of fcf income to pay off all of its debts.
MCY has a better Debt to FCF ratio (0.74) than 74.82% of its industry peers.
A Debt/Equity ratio of 0.35 indicates that MCY is not too dependend on debt financing.
MCY has a Debt to Equity ratio of 0.35. This is comparable to the rest of the industry: MCY outperforms 48.92% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 0.74 | ||
| Altman-Z | 1.42 |
ROIC/WACC0.54
WACC8.06%
2.3 Liquidity
MCY has a Current Ratio of 0.15. This is a bad value and indicates that MCY is not financially healthy enough and could expect problems in meeting its short term obligations.
MCY has a better Current ratio (0.15) than 68.35% of its industry peers.
MCY has a Quick Ratio of 0.15. This is a bad value and indicates that MCY is not financially healthy enough and could expect problems in meeting its short term obligations.
With a decent Quick ratio value of 0.15, MCY is doing good in the industry, outperforming 68.35% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.15 | ||
| Quick Ratio | 0.15 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 231.65% over the past year.
MCY shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -30.12% yearly.
MCY shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 18.32%.
The Revenue has been growing slightly by 6.49% on average over the past years.
EPS 1Y (TTM)231.65%
EPS 3Y-62.17%
EPS 5Y-30.12%
EPS Q2Q%331.91%
Revenue 1Y (TTM)18.32%
Revenue growth 3Y6.95%
Revenue growth 5Y6.49%
Sales Q2Q%20.47%
3.2 Future
The Earnings Per Share is expected to grow by 181.13% on average over the next years. This is a very strong growth
Based on estimates for the next years, MCY will show a quite strong growth in Revenue. The Revenue will grow by 12.02% on average per year.
EPS Next Y1583.33%
EPS Next 2Y367.8%
EPS Next 3Y181.14%
EPS Next 5YN/A
Revenue Next Year21.14%
Revenue Next 2Y15.35%
Revenue Next 3Y12.02%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
MCY is valuated correctly with a Price/Earnings ratio of 15.17.
The rest of the industry has a similar Price/Earnings ratio as MCY.
When comparing the Price/Earnings ratio of MCY to the average of the S&P500 Index (30.97), we can say MCY is valued rather cheaply.
A Price/Forward Earnings ratio of 9.61 indicates a reasonable valuation of MCY.
MCY's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. MCY is cheaper than 61.15% of the companies in the same industry.
MCY's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.17 | ||
| Fwd PE | 9.61 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MCY indicates a somewhat cheap valuation: MCY is cheaper than 67.63% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of MCY indicates a somewhat cheap valuation: MCY is cheaper than 73.38% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 4.49 | ||
| EV/EBITDA | 7.85 |
4.3 Compensation for Growth
MCY's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
MCY's earnings are expected to grow with 181.13% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.01
PEG (5Y)N/A
EPS Next 2Y367.8%
EPS Next 3Y181.14%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.01%, MCY has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 5.21, MCY has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.22, MCY has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.01% |
5.2 History
The dividend of MCY decreases each year by -12.70%.
MCY has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)-12.7%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
MCY pays out 22.02% of its income as dividend. This is a sustainable payout ratio.
DP22.02%
EPS Next 2Y367.8%
EPS Next 3Y181.14%
MERCURY GENERAL CORP
NYSE:MCY (10/8/2024, 8:09:46 PM)
After market: 63.11 0 (0%)63.11
+0.29 (+0.46%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap3.49B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.01% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS beat(16)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.17 | ||
| Fwd PE | 9.61 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.01
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.13% | ||
| ROE | 19.36% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 8.29% | ||
| PM (TTM) | 6.36% | ||
| GM | N/A | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.65
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.15 | ||
| Quick Ratio | 0.15 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)231.65%
EPS 3Y-62.17%
EPS 5Y
EPS Q2Q%
EPS Next Y1583.33%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)18.32%
Revenue growth 3Y6.95%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y