AIA - Not Letting Cash Burning a Hole in Their Pockets

AIA's Australian Acquisition Boosts Our Long-Term Outlook for the Company

AIA's China Business Will Benefit From China's Opening Up of Its Financial System

Transaction Cap by UnionPay Should Have Limited Impact on AIA

Leading Independent Investment Research, Morningstar, Inc.

Morningstar

Leading Independent Investment Research

Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. We offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors. 

Morningstar provides data on more than 500,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 16 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries, with more than $180 billion in assets under advisement or management as of June 30, 2015. We have operations in 27 countries.

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Equity Bottom-Up

AIA’s 2016 annual results delivered 25% and 10% respective increases in new business value and embedded value. The year-on-year growth came in higher than our growth expectations of 22% and 8%, thanks to robust sales in the Hong Kong and Chinese markets, along with better than expected investment returns and exchange-rate impacts. However, we think these factors are largely incorporated into its current share price, and we plan to modestly increase our fair value estimate by 5%-6% to reflect the time value of money, which was partially offset by our expectation for lower growth momentum in certain markets.The stock is fairly valued, trading at a 6% discount to our fair value estimate of HKD 52 per share. We maintain our no-moat rating for AIA, given the highly competitive marketplace and lack of differentiation in products provided by insurers.Analysts: Iris Tan, CFA and Michael Wu, CAIA

AIA’s 2016 annual results delivered 25% and 10% respective increases in new business value and embedded value. The year-on-year growth came in higher than our growth expectations of 22% and 8%, thanks to robust sales in the Hong Kong and Chinese markets, along with better than expected investment returns and exchange-rate impacts. However, we think these factors are largely incorporated into its current share price, and we plan to modestly increase our fair value estimate by 5%-6% to reflect the time value of money, which was partially offset by our expectation for lower growth momentum in certain markets.The stock is fairly valued, trading at a 6% discount to our fair value estimate of HKD 52 per share. We maintain our no-moat rating for AIA, given the highly competitive marketplace and lack of differentiation in products provided by insurers.Analysts: Iris Tan, CFA and Michael Wu, CAIA

AIA Delivered Strong Growth but Faces Higher Near-Term Uncertainty

AIA Group Ltd

AIA Delivered Strong Growth but Faces Higher Near-Term Uncertainty