Enstar Group Limited (ESGR) | Investment Case

1. Company Snapshot

1.a. Company Description

Enstar Group Limited acquires and manages insurance and reinsurance companies, and portfolios of insurance and reinsurance business in run-off.It engages in the run-off property and casualty, and other non-life lines insurance businesses.The company also provides consulting services, including claims inspection, claims validation, reinsurance asset collection, syndicate management, and IT consulting services to the insurance and reinsurance industry.

It operates in Bermuda, the United States, the United Kingdom, Australia, and other Continental European countries.The company was formerly known as Castlewood Holdings Limited and changed its name to Enstar Group Limited in January 2007.The company was founded in 1993 and is headquartered in Hamilton, Bermuda.

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1.b. Last Insights on ESGR

Enstar Group Limited's recent performance was driven by several positive factors. The company announced a quarterly preference share dividend, indicating a commitment to returning value to shareholders. Additionally, Enstar completed a transaction with James River, expanding its business scope. Furthermore, its subsidiary, Cavello Bay Reinsurance Limited, was assigned a "A" Financial Strength Rating by AM Best, enhancing its creditworthiness. The company also completed a transaction with Atrium Syndicate 609, solidifying its position in the Lloyd's market. These developments demonstrate Enstar's strategic growth initiatives and commitment to strengthening its financial position.

1.c. Company Highlights

Last Price	337.91
Change Percentage	0.46%
Open	337.91
Previous Close	337.91
Market Cap ( Millions)	5038
Volume	237945
Year High	348.48
Year Low	315.94
M A 50	335.08
M A 200	328.7

FCF Yield	15.76%
Dividend Yield	0.00%
ROE	8.41%
Debt / Equity	31.38%
Net Debt / EBIDTA	121.37%
Price To Book	0.81
Price Earnings Ratio	9.93
Price To FCF	6.35
Price To sales	4.21
EV / EBITDA	9.07

2. Transcript Summary

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3. NewsRoom

First Pacific Advisors' Strategic Moves: Becton Dickinson & Co Takes Center Stage

Nov -13

Source: gurufocus.com

Enstar Group Limited Announces Quarterly Preference Share Dividends

Nov -05

Source: globenewswire.com

Enstar Group Limited Announces Quarterly Preference Share Dividends

Aug -28

Source: globenewswire.com

Sixth Street Completes Acquisition of Enstar

Jul -02

Source: globenewswire.com

Enstar Group Limited Announces Quarterly Preference Share Dividends

May -05

Source: globenewswire.com

AXIS Completes Previously Announced Transaction With Enstar

Apr -24

Source: globenewswire.com

AXIS Completes Previously Announced Transaction With Enstar

Apr -24

Source: businesswire.com

Enstar Group Limited Announces Expiration and Results of Cash Tender Offer For Junior Subordinated Notes Due 2040

Mar -17

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.26%)

6. Segments

Investments

Expected Growth: 6.5%

Enstar Group's diversified portfolio, strategic acquisitions, and capital support to its subsidiaries drive growth. Increasing demand for insurance and reinsurance products, coupled with the company's expertise in run-off management, further fuels expansion.

Assumed Life

Expected Growth: 5.5%

Assumed Life segment growth driven by increasing demand for reinsurance, Enstar's expertise in managing legacy policies, and steady income stream from reinsured life insurance policies.

Run-off

Expected Growth: 5.5%

The run-off segment is expected to grow driven by increasing demand for legacy portfolio management, Enstar's expertise in managing complex insurance portfolios, and the need for insurers to free up capital and focus on core business.

Corporate and Other

Expected Growth: 4.5%

The Corporate and Other segment of Enstar Group Limited is expected to grow driven by increasing investment income, diversification of revenue streams, and strategic cost management. The segment's growth is also fueled by the company's expanding presence in the global insurance market.

7. Detailed Products

Run-off Acquisition

Enstar Group Limited acquires and manages run-off insurance portfolios, providing a solution for insurers and reinsurers seeking to exit or divest non-core businesses.

Reinsurance

Enstar provides reinsurance solutions to insurers and reinsurers, helping them manage risk and optimize their capital.

Insurance Services

Enstar offers a range of insurance services, including claims administration, policy administration, and actuarial services.

Asset Management

Enstar's asset management business invests and manages assets on behalf of its insurance subsidiaries and third-party clients.

8. Enstar Group Limited's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Enstar Group Limited is moderate due to the availability of alternative insurance products and services.

Bargaining Power Of Customers

The bargaining power of customers is low for Enstar Group Limited due to the company's strong brand reputation and limited switching costs.

Bargaining Power Of Suppliers

The bargaining power of suppliers is moderate for Enstar Group Limited due to the presence of multiple suppliers and the company's ability to negotiate prices.

Threat Of New Entrants

The threat of new entrants is high for Enstar Group Limited due to the low barriers to entry and the attractiveness of the insurance industry.

Intensity Of Rivalry

The intensity of rivalry is high for Enstar Group Limited due to the presence of multiple competitors and the high level of competition in the insurance industry.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	24.86%
Debt Cost	3.95%
Equity Weight	75.14%
Equity Cost	7.32%
WACC	6.48%
Leverage	33.08%

11. Quality Control: Enstar Group Limited passed 4 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Old Republic International

A-Score: 7.6/10

Value: 6.5

Growth: 5.1

Quality: 6.1

Yield: 10.0

Momentum: 8.0

Volatility: 9.7

1-Year Total Return ->

Ares Capital

A-Score: 7.3/10

Value: 6.7

Growth: 5.1

Quality: 8.0

Yield: 10.0

Momentum: 4.0

Volatility: 10.0

1-Year Total Return ->

Principal Financial Group

A-Score: 6.5/10

Value: 6.3

Growth: 5.4

Quality: 6.7

Yield: 8.0

Momentum: 4.0

Volatility: 8.7

1-Year Total Return ->

Equitable Holdings

A-Score: 6.1/10

Value: 4.8

Growth: 7.7

Quality: 6.0

Yield: 4.0

Momentum: 7.0

Volatility: 7.3

1-Year Total Return ->

Jackson Financial

A-Score: 5.9/10

Value: 5.3

Growth: 4.3

Quality: 7.1

Yield: 8.0

Momentum: 5.0

Volatility: 5.7

1-Year Total Return ->

Enstar

A-Score: 5.8/10

Value: 6.4

Growth: 4.3

Quality: 8.1

Yield: 0.0

Momentum: 6.0

Volatility: 10.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-6.86%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

6.48%

Enstar Group Limited - BMG3075P1014

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on ESGR

1.c. Company Highlights

Lower Yield

Medium Volatility

Stable Momentum

Strong Momentum

Less Volatile

Lower Growth

Better Quality

Cheaper

Average Quality

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.26%)

6. Segments

Investments

Expected Growth: 6.5%

Assumed Life

Expected Growth: 5.5%

Run-off

Expected Growth: 5.5%

Corporate and Other

Expected Growth: 4.5%

7. Detailed Products

Run-off Acquisition

Reinsurance

Insurance Services

Asset Management

8. Enstar Group Limited's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Enstar Group Limited passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

337.91$

Current Price

337.91$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA