Enact Holdings, Inc.
Enact Holdings, Inc. Fundamental Analysis
Enact Holdings, Inc. (ACT) shows strong financial fundamentals with a PE ratio of 8.91, profit margin of 54.62%, and ROE of 12.83%. The company generates $1.2B in annual revenue with moderate year-over-year growth of 4.42%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 68.4/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze ACT's fundamental strength across five key dimensions:
Efficiency Score
WeakACT struggles to generate sufficient returns from assets.
Valuation Score
ModerateACT shows balanced valuation metrics.
Growth Score
WeakACT faces weak or negative growth trends.
Financial Health Score
ExcellentACT maintains a strong and stable balance sheet.
Profitability Score
ModerateACT maintains healthy but balanced margins.
Key Financial Metrics
Is ACT Expensive or Cheap?
P/E Ratio
ACT trades at 8.91 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, ACT's PEG of 2.30 indicates potential overvaluation.
Price to Book
The market values Enact Holdings, Inc. at 1.12 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 6.44 times EBITDA. This is generally considered low.
How Well Does ACT Make Money?
Net Profit Margin
For every $100 in sales, Enact Holdings, Inc. keeps $54.62 as profit after all expenses.
Operating Margin
Core operations generate 69.57 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $12.83 in profit for every $100 of shareholder equity.
ROA
Enact Holdings, Inc. generates $9.78 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Enact Holdings, Inc. generates strong operating cash flow of $725.05M, reflecting robust business health.
Free Cash Flow
Enact Holdings, Inc. generates strong free cash flow of $725.05M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $5.02 in free cash annually.
FCF Yield
ACT converts 12.06% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
8.91
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
2.30
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.12
vs 25 benchmark
P/S Ratio
Price to sales ratio
4.87
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.14
vs 25 benchmark
Current Ratio
Current assets to current liabilities
6.86
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.13
vs 25 benchmark
ROA
Return on assets percentage
0.10
vs 25 benchmark
ROCE
Return on capital employed
0.13
vs 25 benchmark
How ACT Stacks Against Its Sector Peers
| Metric | ACT Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 8.91 | 18.91 | Better (Cheaper) |
| ROE | 12.83% | 788.00% | Weak |
| Net Margin | 54.62% | 2164.00% | Weak |
| Debt/Equity | 0.14 | 0.82 | Strong (Low Leverage) |
| Current Ratio | 6.86 | 616.06 | Strong Liquidity |
| ROA | 9.78% | -23806.00% (disorted) | Weak |
ACT outperforms its industry in 3 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Enact Holdings, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
28.24%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
5.80%
Industry Style: Value, Dividend, Cyclical
GrowingFCF CAGR
43.01%
Industry Style: Value, Dividend, Cyclical
High Growth