American Independence (American Independence) Intrinsic Value: DCF (FCF Based) : $0.00 (As of May. 05, 2024)

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What is American Independence Intrinsic Value: DCF (FCF Based)?

As of today (2024-05-05), American Independence's intrinsic value calculated from the Discounted Cash Flow model is $0.00.

Note: Discounted Cash Flow model is only suitable for predictable companies (Business Predictability Rank higher than 1-Star). If the company's predictability rank is 1-Star or Not Rated, result may not be accurate due to the low predictability of business and the data will not be stored into our database.

American Independence's Predictability Rank is Not Rated. Thus, this page is only used for demonstration purposes and the DCF related results in the screener and portfolio will appear as zero.

Margin of Safety (FCF Based) using Discounted Cash Flow model for American Independence is N/A%.

The industry rank for American Independence's Intrinsic Value: DCF (FCF Based) or its related term are showing as below:

AMIC's Price-to-DCF (FCF Based) is not ranked ^*
in the Insurance industry.
Industry Median: 0.49
* Ranked among companies with meaningful Price-to-DCF (FCF Based) only.

American Independence Intrinsic Value: DCF (FCF Based) Historical Data

The historical data trend for American Independence's Intrinsic Value: DCF (FCF Based) can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

American Independence Intrinsic Value: DCF (FCF Based) Chart

American Independence Annual Data

Trend

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Intrinsic Value: DCF (FCF Based)

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American Independence Quarterly Data
	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14	Jun14	Sep14	Dec14	Mar15	Jun15	Sep15	Dec15	Mar16	Jun16
Intrinsic Value: DCF (FCF Based)	Get a 7-Day Free Trial															-	-	-	-	-

Competitive Comparison of American Independence's Intrinsic Value: DCF (FCF Based)

For the Insurance - Life subindustry, American Independence's Price-to-DCF (FCF Based), along with its competitors' market caps and Price-to-DCF (FCF Based) data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

American Independence's Price-to-DCF (FCF Based) Distribution in the Insurance Industry

For the Insurance industry and Financial Services sector, American Independence's Price-to-DCF (FCF Based) distribution charts can be found below:

* The bar in red indicates where American Independence's Price-to-DCF (FCF Based) falls into.

American Independence Intrinsic Value: DCF (FCF Based) Calculation

This is the intrinsic value calculated from the Discounted Cash Flow model with default parameters. In a discounted cash flow model, the future cash flow is estimated based on a cash flow growth rate and a discount rate. The cash flow of the future is discounted to its current value at the discount rate. All of the discounted future cash flow is added together to get the current intrinsic value of the company.

Usually a two-stage model is used when calculating a stock's intrinsic value using a discounted cash flow model. The first stage is called the growth stage; the second is called the terminal stage. In the growth stage the company grows at a faster rate. Because it cannot grow at that rate forever, a lower rate is used for the terminal stage.

GuruFocus DCF calculator is a two-stage model. The default values are defined as:

1. Discount Rate: d = 11%
A reasonable discount rate assumption should be at least the long term average return of the stock market, which can be estimated from risk free rate plus risk premium of stock market. GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate and rounded up to the nearest integer. It is updated daily. The current risk-free rate is 4.50%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default. Then we added a risk premium of 6% to get the estimated discount rate. Some investors use their expected rate of return, which is also reasonable. A typical discount rate can be anywhere between 6% - 20%.

2. Growth Rate in the growth stage: g1 = 5%
The Growth Rate in the growth stage is initially set as the default 10-Year FCF Growth Rate (Per Share). In cases where the 10-year growth rate is unavailable, it defaults to using the 5-Year FCF Growth Rate (Per Share). If both the 10-year and 5-year growth rates are unavailable, the system defaults to the 3-Year FCF Growth Rate (Per Share).
However, it's important to note that there is a growth rate range. If the calculated growth rate exceeds 20%, it will be capped at 20%. Conversely, if the calculated growth rate falls below 5%, it will be adjusted to 5% to maintain a reasonable range.
=> American Independence's average Free Cash Flow Growth Rate in the past 3 years was 0.00%, which is less than 5%. GuruFocus defaults => Growth Rate: 5%

3. Years of Growth Stage: y1 = 10

4. Terminal Growth Rate: g2 = 4%

5. Years of Terminal Growth: y2 = 10

6. Free Cash Flow per Share: fcf = $0.000.
However, GuruFocus DCF calculator is actually a Discounted Earnings calculator, the EPS without NRI is used as the default. The reason we are doing this is we found that historically stock prices are more correlated with earnings than free cash flow.

All of the default settings can be changed and the results are calculated automatically.

American Independence's Intrinsic Value: DCF (FCF Based) for today is calculated as

Intrinsic Value: DCF (FCF Based)	=	Free Cash Flow per Share	*	{[(1+g1)/(1+d)	+	(1+g1)^2/(1+d)^2	+	...	+	(1+g1)^10/(1+d)^10]
	+	(1+g1)^10/(1+d)^10	*	[(1+g2)/(1+d)	+	(1+g2)^2/(1+d)^2	+	...	+	(1+g2)^10/(1+d)^10]}

set x = (1+g1)/(1+d) = (1+0.05)/(1+0.11) = 0.94594594594595
and y = (1+g2)/(1+d) = (1+0.04)/(1+0.11) = 0.93693693693694

Intrinsic Value: DCF (FCF Based)

Free Cash Flow per Share

{[x

x^2

...

x^10]

x^10

y^2

...

y^10]}

Free Cash Flow per Share

(1-x^10)

(1-x)

x^10

(1-y^10)

(1-y)]

0.000

11.5406

0.00

Margin of Safety (FCF Based)	=	(Intrinsic Value: DCF (FCF Based)	-	Current Price)	/	Intrinsic Value: DCF (FCF Based)
	=	(0	-	24.72)	/	0
	=	N/A %

American Independence (NAS:AMIC) Intrinsic Value: DCF (FCF Based) Explanation

Unlike valuation methods such as Net Current Asset Value, Tangible Book per Share, Graham Number, Median PS Value etc, discounted Cash Flow model evaluates the companies based on their future earnings power instead of their assets.

Be Aware

What you need to know about the DCF model:

1. The DCF model evaluates a company based on its future earnings power
2. Growth is taken into account; therefore a faster growth company is worth more if everything else is the same.
3. Since we are projecting future growth, it is assumed that the company will grow at the same rate as it did during the past 10 years. Therefore this model works better for the companies that have relatively consistent performance.
4. The DCF model works poorly for inconsistent performers such as cyclicals.
5. What discount rate should you use? Your expected return from the investment is a good discount rate assumption.
6. A larger margin of safety should be required for companies with less predictable businesses.

You can screen for stocks that trade below their Intrinsic Value: DCF (FCF Based) and Intrinsic Value: DCF (Earnings Based) with the GuruFocus All-in-One Screener. Companies with a high Predictability Rank that trade at a discount to their Intrinsic Value: DCF (FCF Based) and Intrinsic Value: DCF (Earnings Based) can be found in the screen of Undervalued Predictable Companies.

American Independence Intrinsic Value: DCF (FCF Based) Related Terms

Thank you for viewing the detailed overview of American Independence's Intrinsic Value: DCF (FCF Based) provided by GuruFocus.com. Please click on the following links to see related term pages.

American Independence (American Independence) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Insurance » American Independence Corp (NAS:AMIC) » Definitions » Intrinsic Value: DCF (FCF Based)

Comparable Companies

Traded in Other Exchanges

N/A

Address

Website

http://www.americanindependencecorp.com

American Independence Corp is a Delaware corporation. The Company is an insurance holding Company, which provides specialized health coverage and related services to commercial customers and individuals. The Company focuses on niche health products and/or narrowly defined distribution channels in the United States. It's wholly owned subsidiary, Independence American Insurance Company, markets its products through IHC Risk Solutions, LLC, IHC Specialty Benefits, Inc., and IPA Family, LLC, which are subsidiaries of AMIC, and through independent brokers, producers and agents. Independence American is licensed to write property and/or casualty insurance in all 50 states and the District of Columbia, and has an A- (Excellent) rating from A.M. Best Company, Inc. Risk Solutions is a full-service direct writer of medical stop-loss insurance for self-insured employer groups. Risk Solutions has offices near Hartford, Connecticut and Philadelphia, Pennsylvania, and markets and underwrites employer medical stop-loss and group life mainly for Standard Security Life Insurance Company of New York. It also writes, to a much lesser extent, for three other carriers, including Madison National Life Insurance Company, Inc. and Independence American. Independence Holding Company and its subsidiaries including, among others, Standard Security Life and Madison National Life are collectively referred to as "IHC". Independence American writes group important medical, medical stop-loss, crucial medical plans for individuals and families, short-term medical, and dental, and began writing pet insurance in 2012.Independence American competes with many larger insurance and reinsurance companies and managed care organizations. Risk Solutions competes with many other managing general underwriters, insurance companies, and MCOs. AMIC is an insurance holding company; as such, AMIC and its subsidiaries are subject to regulation and supervision by multiple state insurance regulators, including the Office of the Insurance Commissioner of the State of Delaware.

Executives

Teresa A Herbert	director, officer: CFO & SVP	96 CUMMINGS POINT RD, STAMFORD CT 06902
Ronald I Simon	director	485 MADISON AVENUE, 14TH FLOOR, NEW YORK NY 10022
Thung Roy T K	director, officer: CEO	96 CUMMINGS POINT RD STAMFORD CT 06902
James G Tatum	director	96 CUMMINGS POINT RD STAMFORD CT 06902
David T Kettig	director, officer: President	96 CUMMINGS POINT RD STAMFORD CT 06902
Steven B Lapin	director	96 CUMMINGS POINT RD STAMFORD CT 06902
Brian Schlier	officer: Corporate Vice President - Tax	96 CUMMINGS POINT RD STAMFORD CT 06902
Gary Balzofiore	officer: Corporate Vice President	485 MADISON AVENUE, NEW YORK NY 10022
Jeffrey C Smedsrud	officer: Senior Vice President	8009 34TH AVENUE SOUTH #360 BLOOMINGTON MN 55420
Erickson Bernon Reneld Jr	officer: Chief Health Actuary and SVP	INDEPENDENCE HOLDING COMPANY 485 MADISON AVENUE, 14TH FLOOR NEW YORK NY 10022
Scott Michael Wood	officer: Senior Vice President	2101 W. PEORIA AVE, SUITE 100 PHOENIX AZ 85029
Paul R Janerico	officer: VP - Internal Audit	96 CUMMINGS POINT RD STAMFORD CT 06902
Henry B Spencer	officer: VP - Investments	96 CUMMINGS POINT ROAD STAMFORD CT 06902
Roy L Standfest	officer: V.P.& Chief Investment Officer	96 CUMMINGS POINT RD STAMFORD CT 06902

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