Aflac Inc.

AI-generated fair value estimate for this company.

Method: Justified Price/Book (residual-income) model for an insurer: BVPS $60.35, normalized ROE 14% (below TTM 16.91%, inflated by one-time investment/FX gains), cost of equity 9.5% (large-cap insurer with Japan FX exposure), sustainable long-run per-share earnings growth 5% (buyback-driven, payout ratio only 26%, dividend $2.44/share). Justified P/B = (ROE-g)/(r-g) = (0.14-0.05)/(0.095-0.05) = 2.00x BVPS = $120.70/share.

Reasoning: Aflac's GAAP earnings are volatile (alternative-investment/derivative marks) and payout ratio is low, so a naive DDM or FCF DCF understates value; the standard insurer justified-P/B framework (tying ROE, growth and cost of equity directly to book value) is the appropriate lens, and normalizing ROE below the inflated TTM figure avoids overstating durable earnings power.