Athene Q3 Earnings: Is NYSE:ATH Cheap at 7.1x Forward P/E?

in EARNINGS/INVESTING IDEAS by

Athene Holding Ltd. (NYSE:ATH) is scheduled to report Q3 earnings results before markets open for trading on November 3, 2020.

The company is expected to report earnings of $1.10/share on revenue of $1.379 billion. The consensus earnings per share (EPS) of $1.10/share is based on a poll of 9 analysts and represents a decline in eps of −17.9% over the same quarter last year, when the company reported earnings of $1.34/share.

The revenue forecast of $1.379 billion based on a poll of 5 analysts implies a year-over-year (YoY) growth in revenue of 28.8%. Last year the company reported $1.07 billion in revenue for the quarter.

Expected to report EPS contraction of −17.9% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $1,378.63 $1,070.00 28.8%
EPS $1.10 $1.34 −17.9%

Earnings Call Trends

Historically, management has exceeded analyst expectations 5 out of the last 8 tracked quarters, and missed expectations 3 quarters.

What are your expectations from Athene Holding Ltd. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $1.95 $2.39 22.8% Beat
Q1, 2020 -$0.12 -$0.60 -401.5% Missed
Q4, 2019 $1.68 $2.21 31.3% Beat
Q3, 2019 $1.78 $1.34 −24.6% Missed
Q2, 2019 $1.81 $1.95 7.5% Beat
Q1, 2019 $1.72 $1.50 −12.7% Missed
Q4, 2018 $1.20 $1.23 2.2% Beat
Q3, 2018 $1.73 $1.95 12.5% Beat

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price reacted by increasing 4.3%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 5, 2020 $32.61 $34.01 4.3% Increase
May 8, 2020 $24.86 $27.30 9.8% Increase
February 18, 2020 $48.28 $49.30 2.1% Increase
November 5, 2019 $44.94 $43.43 −3.4% Decline

Fundamentals And Technical Analysis

Athene Holding Ltd. is currently trading at $31.15/share, down −2.6% for the day. The company is trading at approximately 62.0% of its 52-week high of $50.43/share. The company’s stock price is down −8.4% since the last earnings report and down −8.4% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 28.78 suggests the company is trading in technically oversold territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:ATH Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 12.93 and a forward P/E multiple of 7.07.

Athene Holding Ltd.’s current share price also implies a price-to-book (P/B) multiple of 0.41. The following table summarizes some other key fundamental ratios:

Data as of October 28, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $31.15
P/E Ratio 12.9x
P/E Ratio (Fwd) 7.1x
PEG Ratio −0.2
Total Debt / Total Capital 17.7%
Levered Free Cash Flow $2.475 billion
Prices To Sales 0.6x

Finbox

Athene Holding Ltd. is a mid-cap stock with a market capitalization of $6.21 billion and a total enterprise value of $2.428 billion. The company operates in the Financials sector and the Insurance industry.

Athene Holding Ltd., a retirement services company, issues, reinsures, and acquires retirement savings products for individuals and institutions in the United States and Bermuda. The company provides annuity retirement solutions to its policyholders; and reinsures multi-year guaranteed annuities, fixed indexed annuities, traditional one-year guarantee fixed deferred annuities, immediate annuities, and institutional products. It also offers funding agreements and group annuities. The company was incorporated in 2008 and is headquartered in Pembroke, Bermuda.

Expertise: financial modeling, mergers & acquisitions. Andy is also a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to do investment research. Andy’s background is in investment banking where he led the analysis on over 50 board advisory engagements involving mergers and acquisitions, fairness opinions and solvency opinions. Some of his board advisory highlights: - Sears Holdings Corp.’s $620 mm spin-off via rights offering of Sears Outlet, Hometown Stores and Sears Hardware Stores. - Cerberus Capital Management’s $3.3 bn acquisition of SUPERVALU Inc.’s New Albertsons, Inc. assets. Andy can be reached at andy@finbox.io or at +1 (516) 778-6257.

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