SAFT Price Forecast Based on Dividend Discount Model

For dividend yielding stocks, the Dividend Discount Model (DDM) is a common valuation tool; it attempts to extrapolate a fair share price based primarily on the dividend the stock provides relative to a number of other quantiative aspects of its business. As for SAFT, the DDM model, as implemented by StockNews, implies a positive return of 74.69% relative to its current price. Digging deeper, the aspects of Safety Insurance Group Inc's dividend discount model that we found most interesting were:

• If we compare the valuation opportunity a dividend discount model provides relative to other dividend stocks in the Financial Services sector, the expected return of 74.69%, based on the stock's current share price and target price based on a dividend discount model, is greater than 82.15% of the DDM-forecasted return of its its sector peers.
• Compared to all dividend issuing stocks in our set, SAFT has a discount rate lower than 82.15% of them (a lower discount rate is associated with lower risk).
• Beta, a measure of volatility relative to the stock market overall, is lower for Safety Insurance Group Inc than it is for 84.64% of other dividend issuers in the Financial Services sector.
• In comparison to its fellow dividend issuing stocks in the Financial Services sector, Safety Insurance Group Inc has an equity discount rate lower than 89.06% of them.

SAFT Dividends vs. Peers