Ambac Financial (AMBC) AI Stock Analysis

• Market Cap: $397.66M
• Dividend Yield: N/A
• Average Volume (3M): 898.36K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.97
• Revenue Growth: -17.06%
• EPS Growth: -118.90%
• Country: US
• Employees: 380
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Specialty
• EPS (TTM): -0.22
• Shares Outstanding: 46,401,737
• 10 Day Avg. Volume: 638,839
• 30 Day Avg. Volume: 898,360
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 2.14
• Enterprise Value/Revenue: 2.86
• Enterprise Value/Gross Profit: 35.63
• Enterprise Value/Ebitda: -10.18
• 1Y Price Target: $15.00
• Price Target Upside: 77.30% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 45 Neutral
• Price Target: $8.50 ▲(0.47% Upside)

Ambac Financial's overall stock score is primarily impacted by its weak financial performance, marked by significant net losses and declining revenues. While the earnings call provided some optimism with growth in premiums and strategic initiatives, the financial challenges and valuation concerns weigh heavily on the stock's attractiveness. Technical analysis provides a neutral outlook, with no strong bullish or bearish signals.

Ambac Financial Business Overview & Revenue Model

Company Description

Ambac Financial Group, Inc. is a financial services holding company primarily engaged in the business of providing financial guarantee insurance and other financial services. The company operates in the municipal bond insurance sector, ensuring the timely payment of principal and interest on municipal bonds. Ambac also engages in credit derivatives and asset management, offering a range of financial products that cater to public and private sector entities. Its core services include enhancing the credit quality of debt securities and providing investment management solutions.

How the Company Makes Money

Ambac Financial generates revenue primarily through the issuance of financial guarantee insurance policies, which protect investors in the event of a default on municipal bonds. The company earns premiums from these policies, which are typically paid upfront or over time. Additionally, Ambac generates income from its investment portfolio, which includes fixed-income securities and other assets. The company also engages in credit derivative transactions, where it may earn fees or premiums related to the management of credit risk. Partnerships with municipalities, underwriters, and financial institutions enhance its market reach and support its revenue generation strategies.

Ambac Financial Financial Statement Overview

Summary

Ambac Financial faces substantial financial challenges, with significant net losses, declining revenues, and weakened cash flow. The elimination of debt is a positive step, but the low equity ratio and poor cash flow metrics highlight vulnerabilities. The company must focus on stabilizing revenue and improving profitability to enhance its financial health.

Income Statement

Ambac Financial's income statement reveals significant challenges. The company experienced a dramatic net loss in 2024, with a negative net profit margin of -235.9%, down from a modest profit in 2023. Revenue growth has been erratic, with a decrease of 12.3% in 2024 following a decline from 2022 to 2023. The absence of EBIT and EBITDA in 2024 further highlights operational difficulties.

Balance Sheet

The balance sheet shows a decrease in stockholders' equity, reducing from $1.36 billion in 2023 to $379 million in 2024, indicating a weakened equity position. However, the company has removed its debt obligations, improving its debt-to-equity ratio from high levels in previous years. Despite this, the equity ratio is relatively low at 6.1%, suggesting potential financial instability.

Cash Flow

Cash flow analysis shows a sharp decline in operating cash flow from $200 million in 2023 to $762,000 in 2024, illustrating cash generation issues. The free cash flow has also deteriorated, reflected in a negligible free cash flow growth rate. The operating cash flow to net income ratio is unfavorable, reflecting poor cash conversion efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	296.93M	235.81M	269.00M	53.61M	282.00M	156.00M
Gross Profit	23.87M	139.52M	269.00M	42.01M	334.00M	156.00M
EBITDA	-83.55M	-30.52M	107.00M	742.00M	246.00M	-160.00M
Net Income	-642.82M	-556.45M	4.00M	521.00M	-28.00M	-437.00M
Balance Sheet
Total Assets	8.52B	8.06B	8.43B	7.97B	12.30B	13.22B
Cash, Cash Equivalents and Short-Term Investments	207.72M	331.90M	2.24B	1.93B	1.85B	2.83B
Total Debt	150.00M	150.00M	3.48B	3.75B	6.45B	7.23B
Total Liabilities	7.30B	6.86B	7.00B	6.65B	11.19B	12.07B
Stockholders Equity	859.84M	856.91M	1.36B	1.25B	1.04B	1.08B
Cash Flow
Free Cash Flow	-41.70M	762.00K	200.00M	1.33B	-131.00M	-353.00M
Operating Cash Flow	-41.70M	762.00K	200.00M	1.33B	-131.00M	-175.00M
Investing Cash Flow	-219.66M	-166.37M	435.00M	-41.16M	776.00M	432.00M
Financing Cash Flow	273.47M	194.22M	-423.00M	-19.23M	-657.00M	-303.00M

Ambac Financial Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8.46
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMBC, the sentiment is Positive. The current price of 8.46 is above the 20-day moving average (MA) of 8.44, below the 50-day MA of 8.75, and below the 200-day MA of 8.65, indicating a neutral trend. The MACD of -0.08 indicates Negative momentum. The RSI at 51.12 is Neutral, neither overbought nor oversold. The STOCH value of 76.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AMBC.

Ambac Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RDN	―	$4.52B	8.41	13.07%	3.05%	0.24%	3.14%
MTG	―	$6.08B	8.77	14.85%	1.97%	3.26%	12.70%
ESNT	―	$5.88B	8.73	12.94%	2.03%	4.79%	-0.76%
AGO	―	$3.85B	8.85	8.38%	1.64%	5.89%	-27.45%
Sector *	―	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
AMBC	―	$397.66M	-28.00	-4.09%	―	-17.06%	-118.90%
MBI	―	$334.74M	-1.45	―	―	―	66.83%

Ambac Financial Corporate Events

Ambac Financial Accelerates Vesting After Assurance Sale

On September 30, 2025, Ambac Financial Group, Inc. accelerated the vesting of performance stock unit awards for its top executives following the sale of Ambac Assurance Corporation on September 29, 2025. The acceleration was due to the completion of legacy business activities tied to the sale, resulting in 368,313 PSUs vesting for CEO Claude LeBlanc, 89,071 for CFO David Trick, and 79,441 for COO R. Sharon Smith.

The most recent analyst rating on (AMBC) stock is a Buy with a $15.00 price target. To see the full list of analyst forecasts on Ambac Financial stock, see the AMBC Stock Forecast page.

Ambac Financial to Acquire ArmadaCare for $250 Million

On September 29, 2025, Ambac Financial Group announced its agreement to acquire ArmadaCare, a leading supplemental health insurance program manager, for $250 million from SiriusPoint Ltd. This acquisition is expected to significantly enhance Ambac’s market position, accelerate its growth trajectory, and strengthen its specialty insurance distribution strategy. The transaction is anticipated to close in the fourth quarter of 2025, subject to customary closing conditions. Ambac plans to finance the acquisition through cash on hand and newly issued debt, including a $120 million commitment from Truist Bank. The acquisition is expected to be accretive to Ambac shareholders by 2026, enhancing the company’s financial profile and offering substantial revenue synergy opportunities.

The most recent analyst rating on (AMBC) stock is a Hold with a $9.00 price target. To see the full list of analyst forecasts on Ambac Financial stock, see the AMBC Stock Forecast page.

Ambac Financial Announces New Executive Employment Agreements

On September 29, 2025, Ambac Financial Group, Inc. entered into new employment agreements with key executives, including Claude LeBlanc, David Trick, and R. Sharon Smith, to continue their roles within the company. These agreements include provisions for base salaries, bonuses, and special awards, with conditions for termination and non-renewal outlined. Additionally, the company announced leadership changes following the resignation of Daniel McGinnis and Stephen M. Ksenak, with R. Sharon Smith and Lawrence F. Metz assuming new roles. The company also appointed Cristina Ahn as Chief Accounting Officer following the sale of Ambac Assurance Corporation.

The most recent analyst rating on (AMBC) stock is a Hold with a $9.00 price target. To see the full list of analyst forecasts on Ambac Financial stock, see the AMBC Stock Forecast page.

Ambac Financial Completes Sale of Legacy Businesses

On September 29, 2025, Ambac Financial Group completed the sale of its legacy financial guarantee businesses, Ambac Assurance Corporation and Ambac Assurance UK Limited, to Oaktree Capital Management for $420 million in cash. This transaction marks a strategic transformation for Ambac, allowing it to focus on becoming a pure-play MGA and specialty insurance platform, which is expected to drive long-term growth and value creation.

The most recent analyst rating on (AMBC) stock is a Hold with a $9.00 price target. To see the full list of analyst forecasts on Ambac Financial stock, see the AMBC Stock Forecast page.

Ambac Financial Group’s Earnings Call: Growth Amid Challenges

Despite Ambac Financial Group’s robust growth in premiums and revenue, the recent earnings call painted a mixed picture, balancing positive strides with significant financial challenges. The company showcased strong operational performance, yet faced notable financial losses and increased expenses, reflecting a complex financial landscape.

Ambac Financial Group Reports Q2 2025 Results

Ambac Financial Group, Inc., an insurance holding company, operates primarily in the specialty property and casualty insurance sector, offering distribution and underwriting services. The company also manages a legacy financial guarantee business that is currently in run-off.