Is Union Assurance overvalued share??

Sumudu Vithanage · 1 Is Union Assurance overvalued share?? Thu Jun 21, 2012 2:23 pm

Sumudu Vithanage

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Is Union Assurance overvalued share??

Fundamental experts pls comment...

opfdo · 2 Re: Is Union Assurance overvalued share?? Thu Jun 21, 2012 5:00 pm

opfdo

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Sumudu Vithanage wrote:Is Union Assurance overvalued share??

Fundamental experts pls comment...

hi, i am not an expert but i can say following,

Last qt EPS------1.02
Annualized-------4.08(1.02*4)
Current Price-----84.70
PER--------------20.75
Sector PER-------10.30 (cse.lk) (actual may be less)
Current Market PER-----13-14 (Bloomberg---10-11)
NAVPS-----------39.06 (net assets value)

by looking at the above factors, I hope now you can understand whether it is overvalued or not !!!!

hunter · 3 Re: Is Union Assurance overvalued share?? Thu Jun 21, 2012 9:23 pm

hunter

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The valuation is a subjective matter (My opinion).

For me, UAL is at least 2.5 times overvalued at ongoing price compared to 'under valued' shares.

Now, how I value it is a little complicated. And added to that I am neither a Fundamentalist nor an expert.

You can take this as just another opinion.

sanjeewa88 · 4 Re: Is Union Assurance overvalued share?? Thu Jun 21, 2012 11:21 pm

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According to the economics the value of a share is the present value of future cash flows. In the company's point of view there is a big potential in insurance market due to the unfilled gap of insurance, specially in life insurance.

This is just because of the unawareness of the insurance and most of the risks are covered by the social and cultural factors. ( in the case of life insurance )

However the current economic condition does not push to have insurance policies to general public or small businesses unless legally bound.

The company financials and the industrial averages illustrate that there is a small over valuation in the market. ( PER is over 20 and this is an extreme case under current market conditions )