Prudential Financial, Inc.
Prudential Financial, Inc. Fundamental Analysis
Prudential Financial, Inc. (PRU) shows moderate financial fundamentals with a PE ratio of 9.87, profit margin of 5.87%, and ROE of 11.44%. The company generates $60.6B in annual revenue with strong year-over-year growth of 30.19%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 74.6/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze PRU's fundamental strength across five key dimensions:
Efficiency Score
WeakPRU struggles to generate sufficient returns from assets.
Valuation Score
ExcellentPRU trades at attractive valuation levels.
Growth Score
ExcellentPRU delivers strong and consistent growth momentum.
Financial Health Score
ExcellentPRU maintains a strong and stable balance sheet.
Profitability Score
WeakPRU struggles to sustain strong margins.
Key Financial Metrics
Is PRU Expensive or Cheap?
P/E Ratio
PRU trades at 9.87 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, PRU's PEG of 0.26 indicates potential undervaluation.
Price to Book
The market values Prudential Financial, Inc. at 1.09 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 7.22 times EBITDA. This is generally considered low.
How Well Does PRU Make Money?
Net Profit Margin
For every $100 in sales, Prudential Financial, Inc. keeps $5.87 as profit after all expenses.
Operating Margin
Core operations generate 7.63 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $11.44 in profit for every $100 of shareholder equity.
ROA
Prudential Financial, Inc. generates $0.46 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Prudential Financial, Inc. produces operating cash flow of $6.24B, showing steady but balanced cash generation.
Free Cash Flow
Prudential Financial, Inc. generates strong free cash flow of $6.24B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $17.92 in free cash annually.
FCF Yield
PRU converts 17.86% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
9.87
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.26
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.09
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.58
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.63
vs 25 benchmark
Current Ratio
Current assets to current liabilities
15.17
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.11
vs 25 benchmark
ROA
Return on assets percentage
0.005
vs 25 benchmark
ROCE
Return on capital employed
0.006
vs 25 benchmark
How PRU Stacks Against Its Sector Peers
| Metric | PRU Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 9.87 | 18.73 | Better (Cheaper) |
| ROE | 11.44% | 847.00% | Weak |
| Net Margin | 5.87% | 3919.00% | Weak |
| Debt/Equity | 0.63 | 0.93 | Strong (Low Leverage) |
| Current Ratio | 15.17 | 674.76 | Strong Liquidity |
| ROA | 0.46% | -21563.00% (disorted) | Weak |
PRU outperforms its industry in 3 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Prudential Financial, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
23.44%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
-26.23%
Industry Style: Value, Dividend, Cyclical
DecliningFCF CAGR
-50.95%
Industry Style: Value, Dividend, Cyclical
Declining