Intrinsic value of Reinsurance Group of America - RGA

Previous Close

$136.87

  Intrinsic Value

$1,660

stock screener

  Rating & Target

str. buy

+999%

  Value-price divergence*

0%

Previous close

$136.87

 
Intrinsic value

$1,660

 
Up/down potential

+999%

 
Rating

str. buy

 
Value-price divergence*

0%

Our model is not good at valuating stocks of financial companies, such as RGA.

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of RGA stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 8.8

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  10.35
  18.90
  17.51
  16.26
  15.13
  14.12
  13.21
  12.39
  11.65
  10.98
  10.39
  9.85
  9.36
  8.93
  8.53
  8.18
  7.86
  7.58
  7.32
  7.09
  6.88
  6.69
  6.52
  6.37
  6.23
  6.11
  6.00
  5.90
  5.81
  5.73
  5.65
Revenue, $m
  0
  13,745
  16,152
  18,778
  21,619
  24,672
  27,930
  31,390
  35,047
  38,896
  42,935
  47,163
  51,579
  56,182
  60,976
  65,964
  71,150
  76,540
  82,142
  87,963
  94,012
  100,302
  106,842
  113,647
  120,729
  128,104
  135,788
  143,797
  152,149
  160,863
  169,960
Variable operating expenses, $m
 
  9,992
  11,742
  13,651
  15,717
  17,936
  20,304
  22,820
  25,478
  28,276
  31,212
  34,285
  37,494
  40,841
  44,326
  47,952
  51,722
  55,640
  59,712
  63,943
  68,341
  72,913
  77,668
  82,614
  87,763
  93,124
  98,710
  104,532
  110,603
  116,938
  123,550
Fixed operating expenses, $m
 
  2,049
  2,100
  2,153
  2,207
  2,262
  2,318
  2,376
  2,436
  2,496
  2,559
  2,623
  2,688
  2,756
  2,825
  2,895
  2,968
  3,042
  3,118
  3,196
  3,276
  3,357
  3,441
  3,527
  3,616
  3,706
  3,799
  3,894
  3,991
  4,091
  4,193
Total operating expenses, $m
  10,353
  12,041
  13,842
  15,804
  17,924
  20,198
  22,622
  25,196
  27,914
  30,772
  33,771
  36,908
  40,182
  43,597
  47,151
  50,847
  54,690
  58,682
  62,830
  67,139
  71,617
  76,270
  81,109
  86,141
  91,379
  96,830
  102,509
  108,426
  114,594
  121,029
  127,743
Operating income, $m
  1,207
  1,703
  2,309
  2,974
  3,696
  4,475
  5,308
  6,195
  7,134
  8,124
  9,164
  10,256
  11,396
  12,586
  13,826
  15,117
  16,461
  17,858
  19,312
  20,823
  22,395
  24,031
  25,733
  27,505
  29,351
  31,274
  33,280
  35,372
  37,555
  39,835
  42,216
EBITDA, $m
  1,234
  1,712
  2,320
  2,986
  3,710
  4,490
  5,325
  6,214
  7,155
  8,148
  9,191
  10,284
  11,427
  12,619
  13,862
  15,157
  16,504
  17,904
  19,361
  20,876
  22,452
  24,091
  25,797
  27,573
  29,423
  31,351
  33,361
  35,458
  37,646
  39,931
  42,318
Interest expense (income), $m
  157
  173
  551
  972
  1,431
  1,927
  2,461
  3,031
  3,635
  4,274
  4,947
  5,653
  6,392
  7,164
  7,969
  8,807
  9,678
  10,585
  11,527
  12,506
  13,524
  14,581
  15,680
  16,824
  18,013
  19,251
  20,540
  21,883
  23,283
  24,743
  26,266
Earnings before tax, $m
  1,044
  1,531
  1,758
  2,002
  2,265
  2,547
  2,847
  3,164
  3,498
  3,849
  4,217
  4,602
  5,003
  5,422
  5,857
  6,310
  6,782
  7,274
  7,785
  8,317
  8,872
  9,450
  10,053
  10,682
  11,338
  12,023
  12,740
  13,489
  14,272
  15,092
  15,950
Tax expense, $m
  343
  413
  475
  541
  612
  688
  769
  854
  945
  1,039
  1,139
  1,243
  1,351
  1,464
  1,581
  1,704
  1,831
  1,964
  2,102
  2,246
  2,395
  2,551
  2,714
  2,884
  3,061
  3,246
  3,440
  3,642
  3,853
  4,075
  4,307
Net income, $m
  701
  1,117
  1,284
  1,462
  1,654
  1,859
  2,078
  2,310
  2,554
  2,810
  3,079
  3,360
  3,652
  3,958
  4,276
  4,607
  4,951
  5,310
  5,683
  6,072
  6,477
  6,898
  7,338
  7,798
  8,277
  8,777
  9,300
  9,847
  10,419
  11,017
  11,644

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  53,098
  63,050
  74,090
  86,136
  99,171
  113,174
  128,122
  143,992
  160,765
  178,422
  196,952
  216,345
  236,599
  257,717
  279,709
  302,588
  326,378
  351,103
  376,797
  403,498
  431,250
  460,100
  490,103
  521,316
  553,804
  587,635
  622,881
  659,619
  697,931
  737,905
  779,631
Adjusted assets (=assets-cash), $m
  53,098
  63,050
  74,090
  86,136
  99,171
  113,174
  128,122
  143,992
  160,765
  178,422
  196,952
  216,345
  236,599
  257,717
  279,709
  302,588
  326,378
  351,103
  376,797
  403,498
  431,250
  460,100
  490,103
  521,316
  553,804
  587,635
  622,881
  659,619
  697,931
  737,905
  779,631
Revenue / Adjusted assets
  0.000
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
Average production assets, $m
  66
  82
  97
  113
  130
  148
  168
  188
  210
  233
  258
  283
  309
  337
  366
  396
  427
  459
  493
  528
  564
  602
  641
  682
  724
  769
  815
  863
  913
  965
  1,020
Working capital, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total debt, $m
  3,929
  12,525
  22,086
  32,518
  43,806
  55,932
  68,877
  82,621
  97,146
  112,438
  128,484
  145,279
  162,819
  181,107
  200,152
  219,966
  240,567
  261,979
  284,230
  307,353
  331,386
  356,370
  382,353
  409,384
  437,519
  466,816
  497,339
  529,154
  562,332
  596,950
  633,085
Total liabilities, $m
  46,005
  54,601
  64,162
  74,594
  85,882
  98,008
  110,953
  124,697
  139,222
  154,514
  170,560
  187,355
  204,895
  223,183
  242,228
  262,042
  282,643
  304,055
  326,306
  349,429
  373,462
  398,446
  424,429
  451,460
  479,595
  508,892
  539,415
  571,230
  604,408
  639,026
  675,161
Total equity, $m
  7,093
  8,449
  9,928
  11,542
  13,289
  15,165
  17,168
  19,295
  21,542
  23,909
  26,392
  28,990
  31,704
  34,534
  37,481
  40,547
  43,735
  47,048
  50,491
  54,069
  57,787
  61,653
  65,674
  69,856
  74,210
  78,743
  83,466
  88,389
  93,523
  98,879
  104,471
Total liabilities and equity, $m
  53,098
  63,050
  74,090
  86,136
  99,171
  113,173
  128,121
  143,992
  160,764
  178,423
  196,952
  216,345
  236,599
  257,717
  279,709
  302,589
  326,378
  351,103
  376,797
  403,498
  431,249
  460,099
  490,103
  521,316
  553,805
  587,635
  622,881
  659,619
  697,931
  737,905
  779,632
Debt-to-equity ratio
  0.554
  1.480
  2.220
  2.820
  3.300
  3.690
  4.010
  4.280
  4.510
  4.700
  4.870
  5.010
  5.140
  5.240
  5.340
  5.420
  5.500
  5.570
  5.630
  5.680
  5.730
  5.780
  5.820
  5.860
  5.900
  5.930
  5.960
  5.990
  6.010
  6.040
  6.060
Adjusted equity ratio
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134
  0.134

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  701
  1,117
  1,284
  1,462
  1,654
  1,859
  2,078
  2,310
  2,554
  2,810
  3,079
  3,360
  3,652
  3,958
  4,276
  4,607
  4,951
  5,310
  5,683
  6,072
  6,477
  6,898
  7,338
  7,798
  8,277
  8,777
  9,300
  9,847
  10,419
  11,017
  11,644
Depreciation, amort., depletion, $m
  27
  9
  10
  12
  14
  16
  17
  20
  22
  24
  26
  28
  31
  34
  37
  40
  43
  46
  49
  53
  56
  60
  64
  68
  72
  77
  81
  86
  91
  97
  102
Funds from operations, $m
  2,004
  1,126
  1,294
  1,474
  1,667
  1,875
  2,096
  2,329
  2,575
  2,834
  3,105
  3,388
  3,683
  3,991
  4,312
  4,646
  4,994
  5,356
  5,732
  6,124
  6,533
  6,959
  7,403
  7,866
  8,349
  8,854
  9,381
  9,933
  10,510
  11,114
  11,746
Change in working capital, $m
  538
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from operations, $m
  1,466
  1,126
  1,294
  1,474
  1,667
  1,875
  2,096
  2,329
  2,575
  2,834
  3,105
  3,388
  3,683
  3,991
  4,312
  4,646
  4,994
  5,356
  5,732
  6,124
  6,533
  6,959
  7,403
  7,866
  8,349
  8,854
  9,381
  9,933
  10,510
  11,114
  11,746
Maintenance CAPEX, $m
  0
  -7
  -8
  -10
  -11
  -13
  -15
  -17
  -19
  -21
  -23
  -26
  -28
  -31
  -34
  -37
  -40
  -43
  -46
  -49
  -53
  -56
  -60
  -64
  -68
  -72
  -77
  -81
  -86
  -91
  -97
New CAPEX, $m
  -45
  -16
  -14
  -16
  -17
  -18
  -20
  -21
  -22
  -23
  -24
  -25
  -26
  -28
  -29
  -30
  -31
  -32
  -34
  -35
  -36
  -38
  -39
  -41
  -42
  -44
  -46
  -48
  -50
  -52
  -55
Cash from investing activities, $m
  -2,826
  -23
  -22
  -26
  -28
  -31
  -35
  -38
  -41
  -44
  -47
  -51
  -54
  -59
  -63
  -67
  -71
  -75
  -80
  -84
  -89
  -94
  -99
  -105
  -110
  -116
  -123
  -129
  -136
  -143
  -152
Free cash flow, $m
  -1,360
  1,103
  1,271
  1,448
  1,639
  1,844
  2,061
  2,292
  2,535
  2,790
  3,057
  3,337
  3,629
  3,933
  4,250
  4,580
  4,923
  5,281
  5,653
  6,040
  6,444
  6,865
  7,303
  7,761
  8,238
  8,737
  9,259
  9,804
  10,374
  10,970
  11,595
Issuance/(repayment) of debt, $m
  733
  8,596
  9,561
  10,432
  11,288
  12,126
  12,945
  13,744
  14,525
  15,291
  16,046
  16,794
  17,540
  18,288
  19,045
  19,814
  20,601
  21,412
  22,251
  23,123
  24,033
  24,984
  25,982
  27,031
  28,135
  29,297
  30,523
  31,815
  33,179
  34,617
  36,135
Issuance/(repurchase) of shares, $m
  -108
  238
  196
  153
  93
  17
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  1,155
  8,834
  9,757
  10,585
  11,381
  12,143
  12,945
  13,744
  14,525
  15,291
  16,046
  16,794
  17,540
  18,288
  19,045
  19,814
  20,601
  21,412
  22,251
  23,123
  24,033
  24,984
  25,982
  27,031
  28,135
  29,297
  30,523
  31,815
  33,179
  34,617
  36,135
Total cash flow (excl. dividends), $m
  -225
  9,938
  11,028
  12,033
  13,020
  13,987
  15,006
  16,036
  17,060
  18,081
  19,104
  20,131
  21,169
  22,221
  23,294
  24,394
  25,525
  26,693
  27,904
  29,163
  30,476
  31,849
  33,286
  34,792
  36,373
  38,035
  39,781
  41,619
  43,552
  45,587
  47,730
Retained Cash Flow (-), $m
  -958
  -1,356
  -1,479
  -1,614
  -1,747
  -1,876
  -2,003
  -2,127
  -2,248
  -2,366
  -2,483
  -2,599
  -2,714
  -2,830
  -2,947
  -3,066
  -3,188
  -3,313
  -3,443
  -3,578
  -3,719
  -3,866
  -4,020
  -4,183
  -4,353
  -4,533
  -4,723
  -4,923
  -5,134
  -5,356
  -5,591
Prev. year cash balance distribution, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  8,582
  9,548
  10,419
  11,274
  12,111
  13,003
  13,909
  14,812
  15,715
  16,621
  17,533
  18,455
  19,391
  20,348
  21,328
  22,337
  23,380
  24,461
  25,585
  26,758
  27,983
  29,265
  30,609
  32,020
  33,501
  35,058
  36,696
  38,418
  40,231
  42,138
Discount rate, %
 
  6.60
  6.93
  7.28
  7.64
  8.02
  8.42
  8.84
  9.29
  9.75
  10.24
  10.75
  11.29
  11.85
  12.45
  13.07
  13.72
  14.41
  15.13
  15.88
  16.68
  17.51
  18.39
  19.31
  20.27
  21.29
  22.35
  23.47
  24.64
  25.87
  27.17
PV of cash for distribution, $m
 
  8,051
  8,351
  8,439
  8,398
  8,234
  8,004
  7,685
  7,279
  6,802
  6,271
  5,702
  5,113
  4,521
  3,939
  3,380
  2,855
  2,372
  1,938
  1,554
  1,224
  944
  714
  528
  381
  269
  185
  124
  81
  51
  31
Current shareholders' claim on cash, %
  100
  97.4
  95.6
  94.4
  93.8
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7
  93.7

Reinsurance Group of America, Incorporated engages in reinsurance business. It offers individual and group life and health insurance products, including term life, credit life, universal life, whole life, group life and health, joint and last survivor insurance, critical illness, disability, and longevity products, as well as asset-intensive and financial reinsurance products. The company also provides reinsurance for mortality, morbidity, and lapse risk associated with products; and reinsurance for investment-related risks, as well as develops and markets technology solutions for the insurance industry. It serves life insurance companies in the United States, Latin America, Canada, Europe, the Middle East, Africa, and the Asia Pacific. Reinsurance Group of America, Incorporated was founded in 1973 and is headquartered in Chesterfield, Missouri.

FINANCIAL RATIOS  of  Reinsurance Group of America (RGA)

Valuation Ratios
P/E Ratio 12.6
Price to Sales 0.8
Price to Book 1.2
Price to Tangible Book
Price to Cash Flow 6
Price to Free Cash Flow 6.2
Growth Rates
Sales Growth Rate 10.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 87.5%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio NaN
LT Debt to Equity 55.4%
Total Debt to Equity 55.4%
Interest Coverage 8
Management Effectiveness
Return On Assets 1.6%
Ret/ On Assets - 3 Yr. Avg. 1.6%
Return On Total Capital 6.9%
Ret/ On T. Cap. - 3 Yr. Avg. 6.5%
Return On Equity 10.6%
Return On Equity - 3 Yr. Avg. 9.6%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 10.6%
EBITDA Margin - 3 Yr. Avg. 9.9%
Operating Margin 10.4%
Oper. Margin - 3 Yr. Avg. 9.8%
Pre-Tax Margin 9%
Pre-Tax Margin - 3 Yr. Avg. 8.5%
Net Profit Margin 6.1%
Net Profit Margin - 3 Yr. Avg. 5.7%
Effective Tax Rate 32.9%
Eff/ Tax Rate - 3 Yr. Avg. 32.6%
Payout Ratio 14.3%

RGA stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the RGA stock intrinsic value calculation we used $11560 million for the last fiscal year's total revenue generated by Reinsurance Group of America. The default revenue input number comes from 2016 income statement of Reinsurance Group of America. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our RGA stock valuation model: a) initial revenue growth rate of 18.9% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 6.6%, whose default value for RGA is calculated based on our internal credit rating of Reinsurance Group of America, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Reinsurance Group of America.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of RGA stock the variable cost ratio is equal to 72.7%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $1999 million in the base year in the intrinsic value calculation for RGA stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 4.4% for Reinsurance Group of America.

Corporate tax rate of 27% is the nominal tax rate for Reinsurance Group of America. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the RGA stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for RGA are equal to 0.6%.

Life of production assets of 10 years is the average useful life of capital assets used in Reinsurance Group of America operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for RGA is equal to 0%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $7093 million for Reinsurance Group of America - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 64.348 million for Reinsurance Group of America is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Reinsurance Group of America at the current share price and the inputted number of shares is $8.8 billion.

RELATED COMPANIES Price Int.Val. Rating
UNM Unum Group 47.93 110.72  str.buy
HRG HRG Group 15.43 4.79  str.sell
CNO CNO Financial 22.31 90.73  str.buy

COMPANY NEWS

▶ Reinsurance Group of America Reports Second-Quarter Results   [Jul-27-17 04:15PM  Business Wire]
▶ 3 Top Reinsurance Stocks for 2017   [Jun-27-17 08:03AM  Motley Fool]
▶ Reinsurance Group of America to Host Investor Day   [May-10-17 04:35PM  Business Wire]
▶ Reinsurance Group misses 1Q profit forecasts   [Apr-27-17 06:22PM  Associated Press]
▶ Reinsurance Group of America to Host Investor Day   [Feb-22-17 05:00PM  Business Wire]
▶ Reinsurance Group beats 4Q profit forecasts   [Jan-30-17 04:40PM  Associated Press]
▶ RGA confirms Manning as new CEO   [Dec-22-16 02:55PM  at bizjournals.com]
▶ Should You Buy Lennox International Inc. (LII)?   [Dec-05-16 06:54AM  at Insider Monkey]
▶ Is Reinsurance Group of America Inc (RGA) A Good Stock To Buy?   [Dec-02-16 03:16AM  at Insider Monkey]
▶ RGA Elects New Member to Board of Directors   [04:01PM  Business Wire]
Stock chart of RGA Financial statements of RGA
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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