ERIE

Erie Indemnity Co

Finance/Real Estate


Presented:12/18/2019
Price:$168.96
Cap:$7.87B
Current Price:$525.65
Cap:$24.48B

Presented

Date12/18/2019
Price$168.96
Market Cap$7.87B
Ent Value$9.91B
P/E Ratio27.64x
Book Value$24.03
Div Yield2.07%
Shares O/S46.57M
Ave Daily Vol150,334
Short IntN/A

Current

Price$525.65
Market Cap$24.48B
Erie Indemnity Co. engages in the business of insurance and operates as an attorney-in-fact. It performs certain services for the Erie Insurance Exchange relating to the sales, underwriting, and issuance of policies. It manages affairs at the Erie Insurance Exchange for the benefit of the policyholders. It covers policies in auto insurance, business insurance, home insurance, life insurance and retirement and property and liability insurance. The company was founded Henry Orth Hirt and Ollie G. Crawford in April 4, 1925 and is headquartered in Erie, PA.

Publicly traded companies mentioned herein: Allstate Corp (ALL), Berkshire Hathaway Inc (BRK/B; BRK/A), Erie Indemnity Company (ERIE)

Highlights

The presenter is short shares of Erie Indemnity Company (ERIE), and believes that continued revenue deceleration combined with acceleration in operating expenses will make it hard for the company to beat the Street’s 2020 earnings estimates. ERIE currently trades at 26x the Street’s 2020 expected EPS of $6.64. If poor underlying fundamental trends continue, he believes ERIE’s 2020 EPS will likely be closer to $5.50. Applying a 20x multiple to that $5.50, he gets to a price target of $110, which is ~35% downside from the stock’s current price of $170.

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Idea Discussion

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