NYSE:PRU
$57.96
(3/19 4:00PM)
+0.3%
| Open | $57.93 |
Mkt Cap | $26.8 Billion |
| High | $58.52 |
52Wk High | $58.52 |
| Low | $57.46 |
52Wk Low | $18.20 |
| Volume | 5.4 Million |
Avg Vol 10D | 3.5 Million |
PRU Revenue
Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 9 years. For, PRU the high and low end of the Price to Sales per share ratios are 1.27x and 0.66x respectively.
Notice that PRU's current Price to Sales per share ratio is 0.80x, which is quite a bit below what we consider a normal Price to Sales ratio for this stock. Given normal conditions and a price of $55.91, PRU is 18% below where we would expect to see it. This will beneficially factor into our final analysis of PRU as it is not often that this stock sinks to these levels.
PRU Cash Earnings
As the old saying goes, "Cash is King!" We look at reported Cash Earnings, but the main emphasis of our analysis involves stripping out non-cash events such as depreciation from our cash earnings analysis. This helps us view the cash flows more clearly. Nevertheless, an analysis of Cash Earnings (both reported and otherwise) is absolutely pivotal to assessing a company's value, and currently PRU is significantly below their historical average multiples of Cash Earnings, as calculated by our proprietary analysis. It is incredibly important to understand that for PRU, the current level of Cash Earnings compared to its historical levels helps identify where PRU is in relation to what the investing community was willing to pay for this level of Cash Earnings in the past. With a historical high Cash Earnings per share ratio of 15.95 and a historical low Cash Earnings per share ratio of 10.07, an investor can relate where value becomes optimal.
So what does "significantly below" mean when we talk about Price to Cash Earnings numbers for PRU? From the Ockham perspective, we are looking specifically at PRU to see if the market is recognizing the huge disparity between PRU's past stock price to Cash Earnings ratio to today's levels. At a difference of 36% below the average historical Price to Cash Earnings ratio, our view would be quite positive at this point. However, as with all metrics, we need to also take other factors into account when looking at PRU. While we view better Cash Earnings metrics as very important, if the market is slow to identify this value, or if Cash Earnings were to fall from these levels, we would become more neutral in our stance.
PRU Dividends
A strong dividend payment history is looked upon as a favorable characteristic on a company’s future and potentially can receive a positive Ockham rating. That being said, we don't require dividend payments for company's whose management has elected to forgo them entirely.
When reviewing dividend yields for PRU, we compare the historic high and low levels over the past, which is similar to our evaluation of Sales and Cash Earnings per share. Paying a dividend is not necessary for any company, but changes in dividend often can lend clues as to the health of the business. A rising dividend is a strong sign for an established company, as it reflects management's confidence in the company. PRU’s estimated annual dividend is $0.70 resulting in a current dividend yield of 1.25%. The highest dividend yield from PRU over recent history was 6.55% while the lowest dividend yield was 0.00%. While it is quite common for a growth stock to pay no dividend at all, but for a mature company such as PRU that has a history of paying dividends it is disappointing to see their dividend yield drop so significantly. At this time, the current dividend yield is 61.83% below the median yield.
Closing Bell Has the Latest News on PRU
Staying informed on the news is invaluable for investors, and RazorWire has captured a recently discussion on PRU from Closing Bell.
It is also notable that we have recently upgraded this stock on Saturday, March 06, 2010 because PRU is more attractive in many of the valuation metrics we evaluate. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on PRU. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, PRU has been less covered in the news compared to the rest of our universe of stocks. The crowd at The Motley Fool does not like PRU and believes that it will Underperform.
“… Joining us now to give us their thoughts is jerry webman, chief economist with op enheimer with quincy crosby, market strategist with PRUDENTIAL financially. …”
Cash flows and Prudential Financial, Incorporated Mentioned on Street Smart With Carol Massar and Matt Miller
Cash flow is a basic fundamental that investors must understand, and Street Smart With Carol Massar and Matt Miller discussed the most recent developments in PRU's cash flow.
Premium Content - please sign up for Ockham PREMIUM to gain full access and to see what Street Smart With Carol Massar and Matt Miller said about PRUDENTIAL FINANCIAL, INC.
Learn About RazorWire?Bloomberg News: Talked Cash Flow and Prudential Financial, Incorporated Recently
The latest cash flow information from PRU was covered on Bloomberg News recently, and investors should be interested in anything that affects their ability to generate cash.
Crowd sentiment is neutral from the millions of opinions submitted through Motley Fool CAPS, which suggests most investors on their platform believe Prudential Financial, Incorporated will perform just about the same as the index. The improving valuation of Prudential Financial, Incorporated has prompted us to upgrade this stock as of Saturday, March 06, 2010. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on PRU. When looking at our entire coverage universe and ranking stocks by the attention they receive on RazorWire, it is clear that Prudential Financial, Incorporated has been talked about more than normal recently.
“… PRUDENTIAL was also added. As for some banks they were adding to, some of the most respected names out there including these three. …”
Bloomberg News Brings News Related to Prudential Financial, Incorporated
As always, the latest news on PRU is available to Ockham clients through RazorWire, and it was mentioned recently on Bloomberg News.
Crowd sentiment is neutral from the millions of opinions submitted through Motley Fool CAPS, which suggests most investors on their platform believe Prudential Financial, Incorporated will perform just about the same as the index. The improving valuation of Prudential Financial, Incorporated has prompted us to upgrade this stock as of Saturday, March 06, 2010. When looking at our entire coverage universe and ranking stocks by the attention they receive on RazorWire, it is clear that Prudential Financial, Incorporated has been talked about more than normal recently. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on PRU.
“… PRUDENTIAL was another to ensure that funds added to. Some of them were the most respected numbers that you have heard of. Goldman sachs, j. P. Morgan, bank. …”
Squawk Box Covers Prudential Financial, Incorporated and Regulators in Same Segment
A regulatory entity and Prudential Financial, Incorporated were among the topics covered on Squawk Box and you can see more details below.
Prudential Financial, Incorporated receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals. Please have a look at our report for our reasons to upgrade the stock to Fairly Valued on our report dated Saturday, March 06, 2010. Ranking all stocks in terms of news coverage offers some interesting data. In the case of PRU, it is getting significantly more attention in recent news coverage than we are used to seeing. The Motley Fool CAPS crowd believes this stock will perform generally in line with the benchmark, or in other words the crowd is neutral.
“… So I believe that the PRUDENTIAL regulator, that's the fed, fdic, and so forth, should have some kind of coordination or say so in dealing with the consumer products. > > …”
Regulators and PRU Talked About On Seeking Alpha Wall St Breakfast
Seeking Alpha Wall St Breakfast talked recently regarding regulatory issues and Prudential Financial, Incorporated, while these two issues may not be related we though it worth noting.
It is also notable that we have recently upgraded this stock on Saturday, March 06, 2010 because PRU is more attractive in many of the valuation metrics we evaluate. Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see Prudential Financial, Incorporated underperforming. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Prudential Financial, Incorporated has actually sunk a bit in comparison to the others. The Ockham valuation currently has a Fairly Valued stance on PRU because it trades within the price range that we would expect given current market conditions and fundamentals.
“… The SEC was "ill-suited, because of our disclosure and enforcement mentality, to really convert to being a PRUDENTIAL regulator. " SEC investigates firms' actions pre-meltdown. …”
Prudential Financial, Incorporated Was Talked About by Taking Stock
As always, the latest news on PRU is available to Ockham clients through RazorWire, and it was mentioned recently on Taking Stock.
Premium Content - please sign up for Ockham PREMIUM to gain full access and to see what Taking Stock said about PRUDENTIAL FINANCIAL, INC.
Learn About RazorWire?Check Out Taking Stock and News on PRU
Prudential Financial, Incorporated is one of the thousands of companies that Ockham has news analytics on, and it was recently discussed on Taking Stock.
Premium Content - please sign up for Ockham PREMIUM to gain full access and to see what Taking Stock said about PRUDENTIAL FINANCIAL, INC.
Learn About RazorWire?See Who is Talking About News from PRU on Taking Stock
The latest news from Taking Stock on PRU is available through Ockham's news analytics platform RazorWire.
Premium Content - please sign up for Ockham PREMIUM to gain full access and to see what Taking Stock said about PRUDENTIAL FINANCIAL, INC.
Learn About RazorWire?Squawk Box Covers Prudential Financial, Incorporated and Regulators in Same Segment
Regulatory issues are always of interest to investors. Recently Squawk Box covered topics including regulators and Prudential Financial, Incorporated.
Prudential Financial, Incorporated receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals. While bearish sentiment on a stock is not always a bad thing, it is something you need to be aware of. The Motley Fool survey of crowd sentiment shows that many investors believe this stock will underperform. Ranking all stocks in terms of news coverage offers some interesting data. In the case of PRU, it is getting significantly more attention in recent news coverage than we are used to seeing. Please have a look at our report for our reasons to upgrade the stock to Fairly Valued on our report dated Saturday, March 06, 2010.
“… Federal reserve has an audit function where we have a better ability to monitor what's going on in the federal reserve than ever before and the other institutions, the other ... …”