Direct Line Insurance Group plc
Direct Line Insurance Group plc Fundamental Analysis
Direct Line Insurance Group plc (DIISY) shows strong financial fundamentals with a PE ratio of 6.80, profit margin of 87.70%, and ROE of 6.65%. The company generates $0.7B in annual revenue with strong year-over-year growth of 15.51%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 56.7/100 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 DIISY's fundamental strength across five key dimensions:
Efficiency Score
WeakDIISY struggles to generate sufficient returns from assets.
Valuation Score
ExcellentDIISY trades at attractive valuation levels.
Growth Score
ModerateDIISY shows steady but slowing expansion.
Financial Health Score
ExcellentDIISY maintains a strong and stable balance sheet.
Profitability Score
WeakDIISY struggles to sustain strong margins.
Key Financial Metrics
Is DIISY Expensive or Cheap?
P/E Ratio
DIISY trades at 6.80 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, DIISY's PEG of -0.14 indicates potential undervaluation.
Price to Book
The market values Direct Line Insurance Group plc at 0.44 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 14.36 times EBITDA. This signals the market has high growth expectations.
How Well Does DIISY Make Money?
Net Profit Margin
For every $100 in sales, Direct Line Insurance Group plc keeps $87.70 as profit after all expenses.
Operating Margin
Core operations generate 1.18 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $6.65 in profit for every $100 of shareholder equity.
ROA
Direct Line Insurance Group plc generates $1.85 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Direct Line Insurance Group plc generates limited operating cash flow of $-1.46B, signaling weaker underlying cash strength.
Free Cash Flow
Direct Line Insurance Group plc generates weak or negative free cash flow of $-1.88B, restricting financial flexibility.
FCF Per Share
Each share generates $-5.79 in free cash annually.
FCF Yield
DIISY converts -10.64% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
6.80
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.14
vs 25 benchmark
P/B Ratio
Price to book value ratio
0.44
vs 25 benchmark
P/S Ratio
Price to sales ratio
23.86
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.18
vs 25 benchmark
Current Ratio
Current assets to current liabilities
17.39
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.07
vs 25 benchmark
ROA
Return on assets percentage
0.02
vs 25 benchmark
ROCE
Return on capital employed
0.03
vs 25 benchmark
How DIISY Stacks Against Its Sector Peers
| Metric | DIISY Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 6.80 | 18.50 | Better (Cheaper) |
| ROE | 6.65% | 809.00% | Weak |
| Net Margin | 87.70% | 2211.00% | Weak |
| Debt/Equity | 0.18 | 0.90 | Strong (Low Leverage) |
| Current Ratio | 17.39 | 692.04 | Strong Liquidity |
| ROA | 1.85% | -24328.00% (disorted) | Weak |
DIISY outperforms its industry in 3 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Direct Line Insurance Group plc's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
45.38%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
-59.29%
Industry Style: Value, Dividend, Cyclical
DecliningFCF CAGR
-182.92%
Industry Style: Value, Dividend, Cyclical
Declining