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Australian Finance Group

ASX:AFG
Snowflake Description

Moderate growth potential second-rate dividend payer.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
AFG
ASX
A$550M
Market Cap
  1. Home
  2. AU
  3. Banks
Company description

Australian Finance Group Limited, together with its subsidiaries, provides mortgage broking services in Australia. The last earnings update was 85 days ago. More info.


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AFG Share Price and Events
7 Day Returns
-6.6%
ASX:AFG
-3.3%
AU Mortgage
0%
AU Market
1 Year Returns
86.1%
ASX:AFG
42.3%
AU Mortgage
15.3%
AU Market
AFG Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Australian Finance Group (AFG) -6.6% 6.3% 15.9% 86.1% 101.6% -
AU Mortgage -3.3% 4.5% 21% 42.3% 19.4% -11.2%
AU Market 0% 0.5% 4.7% 15.3% 21.6% 20.7%
1 Year Return vs Industry and Market
  • AFG outperformed the Mortgage industry which returned 42.3% over the past year.
  • AFG outperformed the Market in Australia which returned 15.3% over the past year.
Price Volatility
AFG
Industry
5yr Volatility vs Market

Value

 Is Australian Finance Group undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Australian Finance Group to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Australian Finance Group.

ASX:AFG Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model Excess Returns Model
Stable EPS Median Return on Equity from the past 5 years.
= Stable Book Value * Return on Equity
= A$0.57 * 33.9%
A$0.19
Book Value of Equity per Share Weighted future Book Value estimates from 2 analysts. A$0.57
Discount Rate (Cost of Equity) See below 8.7%
Perpetual Growth Rate 10-Year AU Government Bond Rate 2.3%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for ASX:AFG
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year AU Govt Bond Rate 2.3%
Equity Risk Premium S&P Global 6%
Mortgage Unlevered Beta Simply Wall St/ S&P Global 0.84
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.835 (1 + (1- 30%) (377.26%))
1.07
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.07
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.31% + (1.07 * 5.96%)
8.69%

Discounted Cash Flow Calculation for ASX:AFG using Excess Returns Model Model

The calculations below outline how an intrinsic value for Australian Finance Group is arrived at using the Excess Return Model. This approach is used for finance firms where free cash flow is difficult to estimate.

In the Excess Return Model the value of a firm can be written as the sum of capital invested currently in the firm and the present value of excess returns that the firm expects to make in the future.

The model is sensitive to the Return on Equity of the company versus the Cost of Equity, how these are calculated is detailed below the main calculation.

Note the calculations below are per share.

See our documentation to learn about this calculation.

ASX:AFG Value of Excess Returns
Calculation Result
Excess Returns = (Stable Return on equity – Cost of equity) (Book Value of Equity per share)
= (33.9% – 8.69%) * A$0.57)
A$0.14
Terminal Value of Excess Returns = Excess Returns / (Cost of Equity - Expected Growth Rate)
= A$0.14 / (8.69% - 2.31%)
A$2.26
Value of Equity = Book Value per share + Terminal Value of Excess Returns
= A$0.57 + A$2.26
A$2.83
ASX:AFG Discount to Share Price
Calculation Result
Value per share (AUD) From above. A$2.83
Current discount Discount to share price of A$2.55
= -1 x (A$2.55 - A$2.83) / A$2.83
9.9%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price Australian Finance Group is available for.
Intrinsic value
10%
Share price is A$2.55 vs Future cash flow value of A$2.83
Current Discount Checks
For Australian Finance Group to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • Australian Finance Group's share price is below the future cash flow value, but not at a moderate discount (< 20%).
  • Australian Finance Group's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Australian Finance Group's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Australian Finance Group's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
ASX:AFG PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-06-30) in AUD A$0.15
ASX:AFG Share Price ** ASX (2019-11-15) in AUD A$2.55
Global Mortgage Industry PE Ratio Median Figure of 174 Publicly-Listed Mortgage Companies 13.93x
Australia Market PE Ratio Median Figure of 519 Publicly-Listed Companies 18.45x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Australian Finance Group.

ASX:AFG PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= ASX:AFG Share Price ÷ EPS (both in AUD)

= 2.55 ÷ 0.15

16.58x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Australian Finance Group is overvalued based on earnings compared to the Global Mortgage industry average.
  • Australian Finance Group is good value based on earnings compared to the Australia market.
Price based on expected Growth
Does Australian Finance Group's expected growth come at a high price?
Raw Data
ASX:AFG PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 16.58x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 3 Analysts
6.5%per year
Global Mortgage Industry PEG Ratio Median Figure of 73 Publicly-Listed Mortgage Companies 1.02x
Australia Market PEG Ratio Median Figure of 346 Publicly-Listed Companies 1.59x

*Line of best fit is calculated by linear regression .

ASX:AFG PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 16.58x ÷ 6.5%

2.57x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Australian Finance Group is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Australian Finance Group's assets?
Raw Data
ASX:AFG PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-06-30) in AUD A$0.49
ASX:AFG Share Price * ASX (2019-11-15) in AUD A$2.55
Australia Mortgage Industry PB Ratio Median Figure of 6 Publicly-Listed Mortgage Companies 0.99x
Australia Market PB Ratio Median Figure of 1,585 Publicly-Listed Companies 1.71x
ASX:AFG PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= ASX:AFG Share Price ÷ Book Value per Share (both in AUD)

= 2.55 ÷ 0.49

5.23x

* Primary Listing of Australian Finance Group.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Australian Finance Group is overvalued based on assets compared to the AU Mortgage industry average.
X
Value checks
We assess Australian Finance Group's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Mortgage industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Mortgage industry average (and greater than 0)? (1 check)
  5. Australian Finance Group has a total score of 1/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

 How is Australian Finance Group expected to perform in the next 1 to 3 years based on estimates from 3 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
6.5%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Australian Finance Group expected to grow at an attractive rate?
  • Australian Finance Group's earnings growth is expected to exceed the low risk savings rate of 2.3%.
Growth vs Market Checks
  • Australian Finance Group's earnings growth is positive but not above the Australia market average.
  • Australian Finance Group's revenue growth is expected to exceed the Australia market average.
Annual Growth Rates Comparison
Raw Data
ASX:AFG Future Growth Rates Data Sources
Data Point Source Value (per year)
ASX:AFG Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 3 Analysts 6.5%
ASX:AFG Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 3 Analysts 6.3%
Global Mortgage Industry Earnings Growth Rate Market Cap Weighted Average 7.5%
Global Mortgage Industry Revenue Growth Rate Market Cap Weighted Average 4.3%
Australia Market Earnings Growth Rate Market Cap Weighted Average 9.8%
Australia Market Revenue Growth Rate Market Cap Weighted Average 3.6%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
ASX:AFG Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (4 months ago) See Below
Future Estimates Average of up to 3 Analyst Estimates (S&P Global) See Below
All numbers in AUD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
ASX:AFG Future Estimates Data
Date (Data in AUD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2022-06-30 764 40 1
2021-06-30 757 37 2
2020-06-30 705 34 2
2019-11-15
ASX:AFG Past Financials Data
Date (Data in AUD Millions) Revenue Cash Flow Net Income *
2019-06-30 643 28 33
2019-03-31 628 29 33
2018-12-31 613 30 33
2018-09-30 608 31 33
2018-06-30 603 32 33
2018-03-31 607 31 38
2017-12-31 611 30 42
2017-09-30 599 28 41
2017-06-30 586 27 39
2017-03-31 556 26 32
2016-12-31 527 26 24
2016-09-30 528 31 23

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Australian Finance Group's earnings are expected to grow by 6.5% yearly, however this is not considered high growth (20% yearly).
  • Australian Finance Group's revenue is expected to grow by 6.3% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
ASX:AFG Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (4 months ago) See Below
Future Estimates Average of up to 3 Analyst Estimates (S&P Global) See Below

All data from Australian Finance Group Company Filings, last reported 4 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

ASX:AFG Future Estimates Data
Date (Data in AUD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2022-06-30 0.18 0.22 0.15 2.00
2021-06-30 0.17 0.20 0.15 3.00
2020-06-30 0.16 0.17 0.14 3.00
2019-11-15
ASX:AFG Past Financials Data
Date (Data in AUD Millions) EPS *
2019-06-30 0.15
2019-03-31 0.15
2018-12-31 0.15
2018-09-30 0.16
2018-06-30 0.16
2018-03-31 0.18
2017-12-31 0.20
2017-09-30 0.19
2017-06-30 0.18
2017-03-31 0.15
2016-12-31 0.11
2016-09-30 0.11

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Australian Finance Group is expected to efficiently use shareholders’ funds in the future (Return on Equity greater than 20%).
X
Future performance checks
We assess Australian Finance Group's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the Global market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the Global market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Australian Finance Group has a total score of 3/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

  How has Australian Finance Group performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Australian Finance Group's growth in the last year to its industry (Mortgage).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Australian Finance Group's year on year earnings growth rate has been positive over the past 5 years.
  • Australian Finance Group's 1-year earnings growth is negative, it can't be compared to the 5-year average.
  • Australian Finance Group's 1-year earnings growth is negative, it can't be compared to the Global Mortgage industry average.
Earnings and Revenue History
Australian Finance Group's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Australian Finance Group Company Filings, last reported 4 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

ASX:AFG Past Revenue, Cash Flow and Net Income Data
Date (Data in AUD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-06-30 642.84 33.03 11.73
2019-03-31 628.05 33.16 11.43
2018-12-31 613.27 33.29 10.75
2018-09-30 608.33 33.31 9.42
2018-06-30 603.39 33.34 8.47
2018-03-31 607.41 37.90 8.72
2017-12-31 611.43 42.47 8.97
2017-09-30 598.76 40.76 9.62
2017-06-30 586.09 39.05 10.27
2017-03-31 556.47 31.66 9.52
2016-12-31 526.84 24.27 8.76
2016-09-30 527.87 23.47 9.24
2016-06-30 528.90 22.67 9.71
2015-12-31 540.20 17.78 9.79
2015-09-30 525.73 16.54 9.32
2015-06-30 511.27 15.30 8.85
2014-06-30 439.87 16.52 8.24
2013-06-30 359.19 15.26 4.47

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Whilst Australian Finance Group has efficiently used shareholders’ funds last year (Return on Equity greater than 20%), this is metric is skewed due to its high level of debt.
  • Australian Finance Group used its assets less efficiently than the Global Mortgage industry average last year based on Return on Assets.
  • Unable to establish if Australian Finance Group improved its use of capital last year versus 3 years ago (Return on Capital Employed) due to insufficient past data.
X
Past performance checks
We assess Australian Finance Group's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Mortgage industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Australian Finance Group has a total score of 1/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is Australian Finance Group's financial position? (This company is analysed differently as a bank or financial institution)

This company is a bank or financial institution.

Fundamentally a bank's business is based upon borrowing and lending money, for this reason they typically have high levels of debt and we analyse them differently.
Net Worth
Balance sheet
This treemap shows a more detailed breakdown of Australian Finance Group's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Australian Finance Group Company Filings, last reported 4 months ago.

ASX:AFG Past Debt and Equity Data
Date (Data in AUD Millions) Total Equity Total Debt Cash & Short Term Investments
2019-06-30 104.82 2,073.77 96.82
2019-03-31 104.82 2,073.77 96.82
2018-12-31 98.08 1,668.43 92.17
2018-09-30 98.08 1,668.43 92.17
2018-06-30 93.32 1,381.76 88.71
2018-03-31 93.32 1,381.76 88.71
2017-12-31 112.45 1,195.72 126.40
2017-09-30 112.45 1,195.72 126.40
2017-06-30 107.30 1,164.48 124.80
2017-03-31 107.30 1,164.48 124.80
2016-12-31 90.33 1,099.94 123.10
2016-09-30 90.33 1,099.94 123.10
2016-06-30 88.52 1,072.22 130.67
2015-12-31 84.01 1,058.81 113.31
2015-09-30 84.01 1,058.81 113.31
2015-06-30 72.23 1,041.10 90.78
2014-06-30 85.47 1,034.69 76.02
2013-06-30 79.09 804.24 65.17
BANK ANALYSIS

This company is a bank or financial institution, which is analysed accordingly below.

Below we check the amount of loans the bank has, how many of those are bad, and its ability to cover any bad loans.
  • Unable to establish if Australian Finance Group has an acceptable proportion of non-loan assets without balance sheet data.
  • Unable to establish if Australian Finance Group's liabilities are primarily made up of low risk funding sources without deposits or liabilities data.
  • Australian Finance Group reports no customer deposits, loans are made up entirely of borrowed funds.
  • Australian Finance Group's level of assets compared to its equity is very high (i.e. bank has borrowed heavily to fund lending).
  • Unable to establish if Australian Finance Group has a sufficient allowance for bad loans without relevant financial data.
  • Unable to establish if Australian Finance Group has an acceptable level of bad loans without bad loans data.
X
Financial health checks
We assess Australian Finance Group's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Australian Finance Group has a total score of 0/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

 What is Australian Finance Group's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
4.16%
Current annual income from Australian Finance Group dividends. Estimated to be 4.86% next year.
If you bought A$2,000 of Australian Finance Group shares you are expected to receive A$83 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Australian Finance Group's pays a higher dividend yield than the bottom 25% of dividend payers in Australia (2.36%).
  • Australian Finance Group's dividend is below the markets top 25% of dividend payers in Australia (5.58%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
ASX:AFG Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 3 Analyst Estimates (S&P Global) See Below
Global Mortgage Industry Average Dividend Yield Market Cap Weighted Average of 131 Stocks 2.5%
Australia Market Average Dividend Yield Market Cap Weighted Average of 391 Stocks 4.1%
Australia Minimum Threshold Dividend Yield 10th Percentile 1.5%
Australia Bottom 25% Dividend Yield 25th Percentile 2.4%
Australia Top 25% Dividend Yield 75th Percentile 5.6%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

ASX:AFG Future Dividends Estimate Data
Date (Data in A$) Dividend per Share (annual) Avg. No. Analysts
2022-06-30 0.13 2.00
2021-06-30 0.13 3.00
2020-06-30 0.11 3.00
2019-11-15
ASX:AFG Past Annualized Dividends Data
Date (Data in A$) Dividend per share (annual) Avg. Yield (%)
2019-08-22 0.106 4.499
2019-02-21 0.104 7.180
2018-08-23 0.104 7.773
2017-08-24 0.097 6.289
2017-02-23 0.096 7.050
2016-09-23 0.084 6.687
2016-08-25 0.084 6.878
2016-02-25 0.060 5.821
2015-09-17 0.085 8.392
2015-08-26 0.043 4.078

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Australian Finance Group has been paying a dividend for less than 10 years and during this time payments have been volatile (annual drop of over 20%).
  • Dividend payments have increased, but Australian Finance Group only paid a dividend in the past 4 years.
Current Payout to shareholders
What portion of Australian Finance Group's earnings are paid to the shareholders as a dividend.
  • Dividends paid are covered by earnings (1.5x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be covered by earnings (1.6x coverage).
X
Income/ dividend checks
We assess Australian Finance Group's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.5%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Australian Finance Group afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Australian Finance Group has a total score of 3/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

 What is the CEO of Australian Finance Group's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
David Bailey
COMPENSATION A$1,031,335
TENURE AS CEO 2.4 years
CEO Bio

Mr. David Bailey has been Chief Executive Officer at Australian Finance Group Ltd. since June 16, 2017 and served as its Chief Operating Officer since October 2015 and also served as its Chief Financial Officer from March 8, 2004 to October 2015. Mr. Bailey was responsible for the finance operations of the AFG group as a whole and his role within the group also extends to assisting in the strategic development of AFG including investigating new business opportunities, assisting in the implementation of new business lines and other significant projects the Australian Finance Group Limited undertakes. Mr. Bailey has with more than 19 years of experience and has been with AFG for more than three years. Mr. Bailey entered the chartered accounting profession where he stayed until 2000 when he took on his first senior role in commerce. He served as a Director at Australian Finance Group Limited. Mr. Bailey graduated from university. Mr. Bailey is a chartered accountant and a Fellow of FINSIA (Financial Services Institute of Australasia).

CEO Compensation
  • David's compensation has been consistent with company performance over the past year, both up more than 20%.
  • David's remuneration is about average for companies of similar size in Australia.
Management Team Tenure

Average tenure of the Australian Finance Group management team in years:

1.7
Average Tenure
  • The average tenure for the Australian Finance Group management team is less than 2 years, this suggests a new team.
Management Team

David Bailey

TITLE
Chief Executive Officer
COMPENSATION
A$1M
TENURE
2.4 yrs

Malcolm Watkins

TITLE
Co-Founder
COMPENSATION
A$196K
AGE
54

Ben Jenkins

TITLE
Chief Financial Officer
COMPENSATION
A$426K
TENURE
3.9 yrs

John Sanger

TITLE
Chief Operating Officer
COMPENSATION
A$455K
TENURE
1.7 yrs

Lisa Bevan

TITLE
Company Secretary
COMPENSATION
A$437K
AGE
46
TENURE
18.8 yrs

Matt Faries

TITLE
Chief Information Officer

Michelle Palethorpe

TITLE
General Counsel
TENURE
0.8 yrs

Alison Clarke

TITLE
Head of Corporate Communications

Chris Slater

TITLE
Head of Sales & Distribution
TENURE
0.4 yrs

Tony Bird

TITLE
Head of Risk
TENURE
0.8 yrs
Board of Directors Tenure

Average tenure and age of the Australian Finance Group board of directors in years:

8
Average Tenure
54
Average Age
  • The tenure for the Australian Finance Group board of directors is about average.
Board of Directors

Tony Gill

TITLE
Independent Non Executive Chairman
COMPENSATION
A$150K
AGE
65
TENURE
11.3 yrs

Malcolm Watkins

TITLE
Co-Founder
COMPENSATION
A$196K
AGE
54
TENURE
21.9 yrs

Craig Carter

TITLE
Independent Non-Executive Director
COMPENSATION
A$90K
TENURE
4.7 yrs

Melanie Kiely

TITLE
Independent Non-Executive Director
COMPENSATION
A$90K
TENURE
3.7 yrs

Jane Muirsmith

TITLE
Independent Non-Executive Director
COMPENSATION
A$90K
TENURE
3.7 yrs

Brett McKeon

TITLE
Co-Founder & Non-Executive Director
COMPENSATION
A$273K
AGE
54
TENURE
23.4 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month open market individual insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (A$) Value (A$)
11. Nov 19 Sell Milford Asset Management Limited Company 26. Mar 19 08. Nov 19 -4,957,237 A$2.21 A$-10,950,396
11. Nov 19 Buy Milford Asset Management Limited Company 22. Mar 19 21. Oct 19 4,218,200 A$1.62 A$6,851,715
11. Nov 19 Sell First Sentier Investors (Australia) IM Ltd Company 22. Oct 19 07. Nov 19 -2,411,787 A$2.62 A$-6,321,661
23. Oct 19 Sell First Sentier Investors (Australia) IM Ltd Company 07. Oct 19 21. Oct 19 -2,309,095 A$2.33 A$-5,377,587
22. Oct 19 Sell First Sentier Investors (Australia) IM Ltd Company 27. Sep 19 21. Oct 19 -2,460,184 A$2.30 A$-5,655,893
22. Oct 19 Buy First Sentier Investors (Australia) IM Ltd Company 01. Oct 19 01. Oct 19 21,161 A$2.21 A$46,869
04. Oct 19 Buy Wilson Asset Management (International) Pty Limited Company 03. Jun 19 03. Oct 19 6,475,321 A$1.99 A$12,852,677
04. Oct 19 Buy MAM Pty Limited Company 03. Jun 19 03. Oct 19 2,420,260 A$2.05 A$4,897,312
03. Oct 19 Sell Realindex Investments Pty Limited Company 26. Sep 19 26. Sep 19 -83,190 A$2.26 A$-187,851
03. Oct 19 Sell First Sentier Investors (Australia) IM Ltd Company 29. Aug 19 01. Oct 19 -2,611,917 A$2.23 A$-5,826,820
03. Oct 19 Buy First Sentier Investors (Australia) IM Ltd Company 04. Sep 19 04. Sep 19 23,545 A$2.25 A$53,056
27. Sep 19 Sell First Sentier Investors (Australia) IM Ltd Company 22. Aug 19 26. Sep 19 -2,375,895 A$2.24 A$-5,318,824
27. Sep 19 Buy First Sentier Investors (Australia) IM Ltd Company 20. Aug 19 05. Sep 19 238,371 A$2.25 A$536,548
30. Aug 19 Sell Realindex Investments Pty Limited Company 20. Aug 19 20. Aug 19 -120,571 A$2.26 A$-272,490
30. Aug 19 Sell First Sentier Investors (Australia) IM Ltd Company 13. Aug 19 28. Aug 19 -2,127,524 A$2.09 A$-4,452,350
14. Aug 19 Buy First Sentier Investors (Australia) IM Ltd Company 09. Aug 19 09. Aug 19 62,430 A$2.02 A$126,283
14. Aug 19 Sell First Sentier Investors (Australia) IM Ltd Company 05. Aug 19 12. Aug 19 -2,271,707 A$1.99 A$-4,510,408
13. Aug 19 Sell Renaissance Smaller Companies Pty Ltd Company 04. May 19 09. Aug 19 -358,054 A$1.99 A$-713,563
13. Aug 19 Buy Renaissance Smaller Companies Pty Ltd Company 04. May 19 09. Aug 19 114,906 A$1.19 A$137,090
13. Aug 19 Sell Australian Ethical Investment Ltd Company 12. Aug 19 12. Aug 19 -600,000 A$2.21 A$-1,323,322
08. Aug 19 Buy Morgan Stanley, Investment Banking and Brokerage Investments Company 03. Apr 19 02. Aug 19 339,233 A$1.67 A$566,751
09. Aug 19 Sell Australian Ethical Investment Ltd Company 22. Feb 19 08. Aug 19 -4,175,355 A$2.00 A$-7,113,708
09. Aug 19 Buy Australian Ethical Investment Ltd Company 20. May 19 20. May 19 500,000 A$1.27 A$634,904
05. Aug 19 Sell First Sentier Investors (Australia) IM Ltd Company 18. Feb 19 02. Aug 19 -3,408,366 A$1.52 A$-5,174,624
05. Aug 19 Buy First Sentier Investors (Australia) IM Ltd Company 08. Feb 19 31. Jul 19 2,180,824 A$1.20 A$2,623,131
05. Aug 19 Buy First Sentier Investors (Australia) IM Ltd Company 20. Jun 19 21. Jun 19 438,226 A$1.52 A$667,231
05. Aug 19 Buy Realindex Investments Pty Limited Company 15. May 19 22. Jul 19 584,186 A$1.61 A$941,891
07. May 19 Sell Renaissance Smaller Companies Pty Ltd Company 03. Jan 19 03. May 19 -139,495 A$1.19 A$-165,999
07. May 19 Buy Renaissance Smaller Companies Pty Ltd Company 03. Jan 19 03. May 19 1,696,700 A$1.12 A$1,892,785
26. Feb 19 Sell Milford Asset Management Limited Company 06. Dec 18 06. Dec 18 -135,614 A$1.30 A$-176,488
26. Feb 19 Buy Milford Asset Management Limited Company 06. Dec 18 25. Feb 19 2,058,952 A$1.31 A$2,574,217
08. Feb 19 Buy First Sentier Investors (Australia) IM Ltd Company 06. Dec 18 07. Feb 19 3,872,676 A$1.04 A$4,033,274
17. Dec 18 Buy Kevin Matthews Individual 12. Dec 18 12. Dec 18 50,000 A$1.28 A$63,965
06. Dec 18 Buy Realindex Investments Pty Limited Company 03. Oct 18 28. Nov 18 522,517 A$1.42 A$739,663
06. Dec 18 Buy First Sentier Investors (Australia) IM Ltd Company 05. Jun 18 05. Dec 18 2,809,329 A$1.38 A$3,889,760
X
Management checks
We assess Australian Finance Group's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Australian Finance Group has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

Simply Wall St News

Australian Finance Group Limited (ASX:AFG): Will The Growth Last?

Australian Finance Group Limited's (ASX:AFG) announced its latest earnings update in August 2019, which indicated that the business faced a slight headwind with earnings deteriorating from AU$33m to AU$33m, a change of -0.9%. … Below is a brief commentary on my key takeaways on how market analysts view Australian Finance Group's earnings growth trajectory over the next couple of years and whether the future looks brighter. … View our latest analysis for Australian Finance Group Analysts' outlook for the upcoming year seems rather muted, with earnings increasing by a single digit 0.4%.

Simply Wall St -

Australian Finance Group Limited (ASX:AFG) Is Yielding 5.4% - But Is It A Buy?

Could Australian Finance Group Limited (ASX:AFG) be an attractive dividend share to own for the long haul? … Strong earnings per share (EPS) growth might encourage our interest in the company despite fluctuating dividends, which is why it's great to see Australian Finance Group has grown its earnings per share at 14% per annum over the past five years. … Earnings per share have been growing rapidly, but given that it is paying out more than half of its earnings as dividends, we wonder how Australian Finance Group will keep funding its growth projects in the future.

Simply Wall St -

Do Directors Own Australian Finance Group Limited (ASX:AFG) Shares?

As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.' Australian Finance Group is a smaller company with a market capitalization of AU$363m, so it may still be flying under the radar of many institutional investors. … Check out our latest analysis for Australian Finance Group ASX:AFG Ownership Summary, July 12th 2019 What Does The Institutional Ownership Tell Us About Australian Finance Group? … We can see that Australian Finance Group does have institutional investors; and they hold 38% of the stock.

Simply Wall St -

Have Insiders Been Buying Australian Finance Group Limited (ASX:AFG) Shares This Year?

So shareholders might well want to know whether insiders have been buying or selling shares in Australian Finance Group Limited (ASX:AFG). … ASX:AFG Recent Insider Trading, May 23rd 2019 Australian Finance Group is not the only stock insiders are buying. … With high insider ownership and encouraging transactions, it seems like Australian Finance Group insiders think the business has merit.

Simply Wall St -

Does Australian Finance Group Limited (ASX:AFG) Have A Place In Your Dividend Portfolio?

Dividend paying stocks like Australian Finance Group Limited (ASX:AFG) tend to be popular with investors, and for good reason - some research shows that a significant amount of all stock market returns come from reinvested dividends. … Unfortunately, one common occurrence with dividend companies is for investors to be enticed in by the seemingly attractive yield, and lose money when the company has to cut its dividend payments. … In this case, Australian Finance Group likely looks attractive to dividend investors, given its 8.8% dividend yield and four-year payment history.

Simply Wall St -

Should You Be Concerned About Australian Finance Group Limited's (ASX:AFG) Historical Volatility?

If you're interested in Australian Finance Group Limited (ASX:AFG), then you might want to consider its beta (a measure of share price volatility) in order to understand how the stock could impact your portfolio. … Beta is a widely used metric to measure a stock's exposure to market risk (volatility). … A stock with a beta below one is either less volatile than the market, or more volatile but not corellated with the overall market.

Simply Wall St -

Australian Finance Group (ASX:AFG) Shares Have Generated A Total Return Of 62% In The Last Three Years

Notably, the Australian Finance Group Limited (ASX:AFG) share price has gained 24% in three years, which is better than the average market return. … Australian Finance Group was able to grow its EPS at 21% per year over three years, sending the share price higher. … This free interactive report on Australian Finance Group's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

Simply Wall St -

Is Now An Opportune Moment To Examine Australian Finance Group Limited (ASX:AFG)?

Australian Finance Group Limited (ASX:AFG), operating in the financial services industry based in Australia,. … As a small cap stock, which tends to lack high analyst coverage, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value? … Let’s examine Australian Finance Group’s valuation and outlook in more detail to determine if there’s still a bargain opportunity

Simply Wall St -

Is Australian Finance Group Limited (ASX:AFG) A Smart Choice For Dividend Investors?

Australian Finance Group Limited (ASX:AFG) has recently paid dividends to shareholders, and currently yields 8.0%. … Let's dig deeper into whether Australian Finance Group should have a place in your portfolio. … Check out our latest analysis for Australian Finance Group?

Simply Wall St -

One Thing To Remember About The Australian Finance Group Limited (ASX:AFG) Share Price

Every stock in the market is exposed to this volatility, which is linked to the fact that stocks prices are correlated in an efficient market. … Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). … Any stock with a beta of greater than one is considered more volatile than the market, while those with a beta below one are either less volatile or poorly correlated with the market.

Simply Wall St -

Company Info

Description

Australian Finance Group Limited, together with its subsidiaries, provides mortgage broking services in Australia. The company operates in two segments, AFG Wholesale Mortgage Broking and AFG Home Loans. It offers residential mortgages; home loans; business loans, such as commercial real estate, equipment and vehicle, inventory, working capital, and start-up finance, as well as franchisee loans and invoice finance/accounts receivable; and insurance products. The company was formerly known as Australian Finance Group Pty Ltd. Australian Finance Group Limited was founded in 1994 and is headquartered in West Perth, Australia.

Details
Name: Australian Finance Group Limited
AFG
Exchange: ASX
Founded: 1994
A$549,698,009
215,567,847
Website: http://www.afgonline.com.au
Address: Australian Finance Group Limited
100 Havelock Street,
Level 4,
West Perth,
Western Australia, 6005,
Australia
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
ASX AFG Ordinary Shares Australian Securities Exchange AU AUD 22. May 2015
CHIA AFG Ordinary Shares Chi-X Australia AU AUD 22. May 2015
Number of employees
Current staff
Staff numbers
203
Australian Finance Group employees.
Industry
Thrifts and Mortgage Finance
Banks
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/11/15 10:40
End of day share price update: 2019/11/15 00:00
Last estimates confirmation: 2019/10/11
Last earnings filing: 2019/08/22
Last earnings reported: 2019/06/30
Last annual earnings reported: 2019/06/30


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.