the alliance-Aktien (WKN: 840400) meanwhile was very, very cheap. With a share price of EUR 180, the insurer DAX achieved a dividend yield of up to 6%. Meanwhile, even a little more than the share price has fallen to the downside.
However, Allianz’s share has now risen again. With a listing of 203.75 euros, the lowest price is no longer possible. At least the cheapest so far; Blessed are those who have invested cheaply!
But have investors missed this opportunity now? Not necessarily. Let’s not forget that the DAX insurer still has an economic valuation measure. And this despite the fact that the stock has increased its market value by up to 13.2% in a very short period of time. Again: Blessed are those who bought from the previous low.
Allianz stock: still not expensive!
Even at the current share price of EUR 203.75, the valuation is not too expensive. Based on 2021 earnings per share of EUR 15.96, the price-earnings ratio is currently 12.8. For me, however, what the adjusted value gives is more relevant. Without special effects, without onerous provisions, the insurer DAX would probably have been close to the 2019 level of EUR 18.90. Based on this value, the price-earnings ratio is not even 11.
But the dividend yield also remains high. With an expected dividend of EUR 10.80, the figure is 5.30%. It is also possible to earn a large amount of passive income. On an adjusted basis, less than 60% of earnings would go to the dividend.
Allianz stock has better fundamentals than reflected in the valuation basis. Management expects moderate earnings growth in the single-digit percentage range through 2024 and adjusted. With earnings per share growing at 5% to 7% annually, the valuation needs to be put into perspective. The dividend should also continue to rise. With a dividend yield of more than 5%, even modest dividend growth can make a significant difference in the long run.
Still not unattractive!
Let’s look at Allianz stock from a different angle: If we didn’t know the good old days were over, wouldn’t we be focusing more on stocks? When will we have a chance to get the DAX insurer with a dividend yield of over 5% and a P/E ratio of just over 10?
The low point is over. There is no doubt about it: spontaneous investors would have already made a good price return if they had bought at around EUR180 per share. But even today, the overall package is no less attractive. Ahead of the DAX dividend season, this valuation may still have a lot of potential. Both in terms of dividend and in general.
The article shared by Allianz: Missed an opportunity? first appeared in The Motley Fool Germany.
Vincent owns shares in Allianz. The Motley Fool does not own any of the shares mentioned.
Motley Fool Germany 2022