OUTsurance Share Price Eyes ZAR 7,674—ROE at 32%, But What’s Next?
OUTsurance Group has been quietly making a name for itself on the Johannesburg Stock Exchange—not through flashy headlines...
Quick overview
- OUTsurance Group has achieved a 32% return on equity, significantly outperforming the insurance industry average of 16%.
- The company's net income growth over the past five years stands at 19%, which is below the industry average of 26%.
- OUTsurance currently pays out 67% of its profits as dividends, with projections indicating this could rise to 72% in the next three years.
- Despite modest growth, OUTsurance offers a balance of capital efficiency and consistent shareholder returns, making it attractive for long-term investors.
OUTsurance Group has been quietly making a name for itself on the Johannesburg Stock Exchange—not through flashy headlines, but with solid fundamentals. The standout stat? A 32% return on equity (ROE) over the past year. That’s double the insurance industry average of 16%, meaning OUTsurance is getting a lot more bang for every rand of investor capital than its peers.
In practical terms, for every R1 shareholders put in, OUTsurance generated R0.32 in profit. It’s a figure that screams capital efficiency. But strong ROE is only half the story. The real question is: how much of that profit is being reinvested to fuel future growth?
Great Returns, Modest Growth
Despite the impressive ROE, OUTsurance’s net income has grown 19% over the past five years—solid, but not stellar when compared to the industry’s 26% average.
The reason? OUTsurance sends a lot of its earnings back to shareholders. It’s currently paying out about 67% of its profits as dividends, which leaves only a third for reinvestment into the business.
And that trend may continue. Analysts expect the payout ratio to rise to 72% over the next three years, even as ROE stays around 33%. That could limit the group’s runway for aggressive expansion—but it also signals a commitment to rewarding shareholders consistently.
Here’s a quick snapshot:
ROE: 32% (vs industry avg. 16%)
5-Year Net Income Growth: 19%
Dividend Payout Ratio: 67%
Projected ROE (Next 3 Years): 33%
Forecasted Payout Ratio: 72%
So, while OUTsurance may not be chasing hypergrowth, it’s managing to deliver value both through capital efficiency and consistent shareholder returns—a balance many investors can appreciate.
Technical Picture: Breakout Levels to Watch
On the chart, OUTsurance is showing strong momentum. It’s currently trading at ZAR 7,275, holding above both its ascending trendline and 50-period EMA (ZAR 6,896). Last week’s breakout above ZAR 7,161 turned that former ceiling into a support level.
The MACD is leaning bullish, suggesting momentum could carry the stock toward the next key levels at ZAR 7,464 and ZAR 7,674, barring any macro shocks.
Trade Setup:
Buy Entry 1: On a bullish bounce from ZAR 7,161
Buy Entry 2: On breakout above ZAR 7,275 with volume
Targets: ZAR 7,464 and ZAR 7,674
Stop Loss: Below ZAR 7,000
This is the kind of setup where waiting for confirmation matters—jumping in early without volume or trend support can lead to whipsaws.
Bottom Line
OUTsurance is doing a lot right: efficient use of capital, stable returns, and a well-managed dividend strategy. While it’s not a high-growth story right now, its mix of profitability and steady payouts makes it an appealing choice for long-term investors looking for stability in a volatile market.
That said, keep an eye on whether it can sustain these returns while managing rising payout ratios. As always, let the chart—and the fundamentals—guide your timing.
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