Stock Analysis & Valuation Athene Holding Ltd. 7.250% Fixe (ATHS)

• Previous Close: $25.28
• Sector Valuation Confidence Level: High

Valuation method	Value, $	Upside, %
Artificial intelligence (AI)	78.15	209
Intrinsic value (DCF)	9.69	-62
Graham-Dodd Method	90.36	257
Graham Formula		n/a

Strategic Investment Analysis

Company Overview

Athene Holding Ltd. (NYSE: ATHS) is a leading financial services company specializing in retirement savings solutions. Operating in the asset management industry, Athene provides innovative products designed to help consumers grow their savings and secure a stable retirement income. The company also partners with businesses to protect and manage retirement funds for employees. With a market capitalization exceeding $5 billion, Athene has established itself as a key player in the retirement solutions sector. The company’s strong financial performance, including $20.7 billion in revenue and $3.5 billion in net income for the latest fiscal year, underscores its robust business model. Athene’s focus on fixed annuity products and retirement income strategies positions it well in an aging demographic landscape, where demand for retirement planning solutions is growing. Headquartered in the U.S., Athene trades on the New York Stock Exchange and maintains a solid balance sheet with $13.3 billion in cash and equivalents.

Investment Summary

Athene Holding Ltd. presents an attractive investment opportunity due to its strong financial performance, stable revenue streams, and focus on the growing retirement solutions market. The company’s $3.5 billion net income and $1.94 dividend per share highlight its profitability and shareholder-friendly policies. With a low beta of 0.34, Athene exhibits lower volatility compared to the broader market, making it a relatively stable investment. However, investors should consider the risks associated with the financial services sector, including regulatory changes and interest rate fluctuations. The company’s high total debt of $7.9 billion could also pose a risk if economic conditions deteriorate. Overall, Athene’s strong market position and consistent earnings make it a compelling choice for income-focused investors.

Competitive Analysis

Athene Holding Ltd. competes in the asset management and retirement solutions sector, where its primary competitive advantage lies in its specialized focus on fixed annuity products and retirement income strategies. The company’s ability to generate consistent cash flows from its annuity business provides a stable revenue base. Athene’s strong balance sheet, with $13.3 billion in cash and equivalents, allows it to weather economic downturns better than many competitors. The company’s partnerships with businesses to manage retirement funds further differentiate it from peers. However, Athene faces competition from larger, diversified financial services firms that offer a broader range of products. The low-interest-rate environment could also pressure annuity yields, impacting profitability. Athene’s competitive positioning is further strengthened by its efficient capital management, as evidenced by its $1.9 billion in operating cash flow and minimal capital expenditures. The company’s focus on retirement solutions aligns well with demographic trends, but it must continue innovating to maintain its edge against competitors with more diversified offerings.

Major Competitors

• Prudential Financial Inc. (PRU): Prudential Financial is a diversified financial services giant with a strong presence in retirement solutions and asset management. Its broader product portfolio gives it an edge over Athene in terms of diversification, but Athene’s specialized focus on annuities allows for deeper expertise in that niche. Prudential’s global reach and brand recognition are strengths, but its larger size may lead to less agility compared to Athene.
• MetLife Inc. (MET): MetLife is another major competitor in the retirement and insurance space, offering a wide range of products including annuities. While MetLife’s extensive distribution network and brand strength are advantages, Athene’s lower expense ratio and focused strategy could make it more efficient in the annuity market. MetLife’s international operations provide diversification but also expose it to additional risks.
• American International Group Inc. (AIG): AIG is a global insurance and retirement solutions provider with a strong annuity business. AIG’s larger scale and diversified operations provide stability, but Athene’s specialized approach may allow for better margins in the annuity segment. AIG’s recent restructuring efforts could improve its competitiveness, but it still faces challenges from legacy issues.
• Lincoln National Corporation (LNC): Lincoln National competes closely with Athene in the annuity and retirement solutions market. Lincoln’s strong brand and distribution network are key strengths, but Athene’s lower cost structure and efficient capital management could give it an edge. Lincoln’s higher debt levels compared to Athene may also be a concern for investors.