Conifer Holdings (CNFR) AI Stock Analysis

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Conifer Holdings

(NASDAQ:CNFR)

48Neutral

Conifer Holdings is facing significant challenges in financial performance, with ongoing issues in profitability and revenue growth. While there is some improvement in its balance sheet and cash flow, these are overshadowed by a bearish technical outlook. The extremely low P/E ratio suggests potential undervaluation, but the lack of a dividend and the company's financial struggles pose significant risks.

Conifer Holdings (CNFR) vs. S&P 500 (SPY)

Market Cap

$7.65M

Dividend YieldN/A

Average Volume (3M)27.01K

Price to Earnings (P/E)0.3

Beta (1Y)-0.09

Revenue Growth-18.97%

EPS GrowthN/A

CountryUS

Employees9

SectorFinancial

Sector Strength83

IndustryInsurance - Property & Casualty

Share Statistics

EPS (TTM)1.93

Shares Outstanding12,222,881

10 Day Avg. Volume54,280

30 Day Avg. Volume27,011

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.10

Price to Cash Flow (P/CF)-0.20

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Conifer Holdings Business Overview & Revenue Model

Company DescriptionConifer Holdings, Inc. (CNFR) is a specialty insurance holding company that operates in the property and casualty insurance sector. The company focuses on providing tailored insurance solutions primarily for small to mid-sized businesses across various industries, including hospitality, artisan contractors, and professional liability. Conifer Holdings is known for its expertise in offering customized policies that meet the unique needs of its clients, leveraging both admitted and non-admitted insurance markets to deliver comprehensive coverage options.

How the Company Makes MoneyConifer Holdings makes money by underwriting and selling specialty insurance products through its subsidiary insurance companies. The company's primary revenue streams include premiums collected from policyholders in exchange for coverage against specified risks. Additionally, Conifer Holdings earns investment income from the management of its insurance float, which consists of money held in reserve for claims that have not yet been paid out. The company also benefits from reinsurance arrangements that help manage risk and stabilize earnings. Key factors contributing to its earnings include its ability to accurately assess risk, set competitive premium rates, and manage claims efficiently. Conifer Holdings may also engage in partnerships with independent agents and brokers to expand its distribution network and reach a broader client base.

Conifer Holdings Financial Statement Overview

Summary

Conifer Holdings is facing significant challenges in profitability and revenue growth, as evidenced by declining income statement metrics. The balance sheet shows improvement with reduced leverage, although returns on equity remain insufficient. Recent positive free cash flow is encouraging, but sustainable operational performance is a concern.

Income Statement

Neutral

Conifer Holdings has experienced a significant decline in revenue over the years, highlighting challenges in maintaining top-line growth. The negative net profit margin and negative EBIT and EBITDA margins indicate ongoing profitability issues, as the company struggles to manage costs effectively.

Balance Sheet

Neutral

The company's balance sheet shows a relatively low debt-to-equity ratio due to recent debt reductions, which is a positive sign of financial health. However, the return on equity is negative, reflecting the company's ongoing net losses. The equity ratio is also relatively low, indicating potential risks associated with leverage.

Cash Flow

Neutral

Conifer Holdings has shown positive free cash flow in the most recent year, a significant improvement from prior periods. However, the company's operating cash flow to net income ratio remains concerning due to ongoing net losses, highlighting challenges in generating cash from operations.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
87.08M	67.27M	98.76M	104.89M	118.59M	107.33M
	Gross Profit
87.08M	67.27M	98.76M	104.89M	118.59M	107.33M
	EBIT
-6.93M	-34.24M	0.00	-17.20M	-15.22M	-2.27M
	EBITDA
-28.04M	-34.24M	-21.89M	-17.10M	1.56M	3.12M
	Net Income Common Stockholders
30.27M	24.35M	-25.90M	-11.05M	-1.92M	-244.00K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
35.24M	27.65M	31.96M	164.16M	182.71M	173.51M
	Total Assets
163.74M	281.66M	311.80M	312.35M	290.40M	261.60M
	Total Debt
27.56M	0.00	25.06M	33.88M	33.56M	41.00M
	Net Debt
9.07M	-27.65M	13.94M	5.84M	23.65M	32.80M
	Total Liabilities
113.46M	260.13M	308.92M	293.40M	249.90M	217.18M
	Stockholders Equity
50.30M	21.52M	2.89M	18.95M	40.50M	44.41M
Cash Flow		Free Cash Flow
-8.83M	3.19M	-13.39M	-70.79M	6.36M	2.90M
	Operating Cash Flow
-7.89M	3.19M	-13.39M	-40.47M	5.36M	2.98M
	Investing Cash Flow
54.30M	70.29M	-272.00K	56.50M	1.38M	-7.34M
	Financing Cash Flow
-10.93M	-21.09M	-3.25M	2.09M	-5.01M	5.08M

Conifer Holdings Technical Analysis

Technical Analysis Sentiment

Negative

Last Price0.62

Price Trends

50DMA

0.82

Negative

100DMA

0.96

Negative

200DMA

0.98

Negative

Market Momentum

MACD

-0.07

Negative

RSI

43.98

Neutral

STOCH

82.09

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CNFR, the sentiment is Negative. The current price of 0.62 is above the 20-day moving average (MA) of 0.62, below the 50-day MA of 0.82, and below the 200-day MA of 0.98, indicating a neutral trend. The MACD of -0.07 indicates Negative momentum. The RSI at 43.98 is Neutral, neither overbought nor oversold. The STOCH value of 82.09 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CNFR.

Conifer Holdings Risk Analysis

Conifer Holdings disclosed 51 risk factors in its most recent earnings report. Conifer Holdings reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Conifer Holdings Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CINF	82 Outperform	$20.52B	9.03	17.61%	2.52%	13.22%	24.83%
SAFT	74 Outperform	$1.15B	16.15	8.66%	4.78%	21.61%	273.90%
MCY	73 Outperform	$2.87B	6.13	26.78%	2.45%	18.27%	385.75%
Sector *	63 Neutral	$13.51B	9.48	9.36%	4.87%	16.09%	-8.30%
KINS	61 Neutral	$227.93M	11.44	36.28%	―	10.69%	―
CNFR	48 Neutral	$7.65M	0.33	-291.99%	―	-18.97%	―

* Financial Sector Average

Performance Comparison

CNFR

Conifer Holdings

0.63

-0.31

-32.98%

CINF

Cincinnati Financial

133.31

19.36

16.99%

KINS

Kingstone Companies

16.80

12.69

308.76%

MCY

Mercury General

52.42

1.53

3.01%

SAFT

Safety Insurance Group

77.25

1.75

2.32%

Conifer Holdings Earnings Call Summary

Earnings Call Date: Mar 28, 2025 | % Change Since: -8.82% | Next Earnings Date: May 7, 2025

Earnings Call Sentiment Neutral

The call highlighted a strategic shift towards a more sustainable revenue model and improved expense management, but also detailed significant declines in gross written premiums, continued net losses, and impacts from adverse weather conditions. The sentiment reflects cautious optimism with ongoing challenges.

Highlights

Strategic Shift to Commission-Based Revenue Model

Conifer has strategically shifted towards a commission-based revenue model through their managing general agency, Conifer Insurance Services, focusing on more stable and predictable revenue streams rather than the traditional risk-bearing carrier revenue model.

Improved Expense Ratio

The expense ratio improved to 32% in the second quarter, down 580 basis points from the same period last year, and well below the near-term target of 35%.

Increase in Agency Commission Revenue

Agency commission in the second quarter rose significantly to nearly $9 million compared to $211,000 in the second quarter of 2023, showcasing progress in driving commission-based revenue.

Net Investment Income Growth

Net investment income was $1.5 million during the second quarter, up 11% from $1.4 million in the prior year period.

Lowlights

Decrease in Gross Written Premium

Gross written premium decreased 58% to $19 million, reflecting the strategic decision to reduce premium leverage on operating subsidiaries.

High Combined Ratio

The overall combined ratio was 124% in the second quarter, impacted by the Oklahoma storms, indicating higher costs relative to premiums earned.

Net Loss for the Quarter

The company reported a net loss allocable to common shareholders of $4 million or $0.32 per share, and an adjusted operating loss of $3.6 million or $0.30 per share for the second quarter of 2024.

Decrease in Fair Value of Investments

There was a $196,000 decrease in the fair value of equity investments in the second quarter, leading to a net realized investment loss of $118,000.

Company Guidance

During Conifer Holdings' Q2 2024 earnings call, the company outlined significant strategic changes aimed at enhancing profitability and long-term growth. The transition to a commission-based revenue model through their wholly-owned managing general agency, Conifer Insurance Services, resulted in a 58% decrease in overall gross written premium, which was split between 36% commercial lines and 64% personal lines. This shift is designed to stabilize revenue streams and reduce risk by leveraging third-party insurers with A.M. Best ratings of A- or better. The commercial lines combined ratio stood at 105%, with an accident year combined ratio of 81%, while the overall combined ratio was impacted by spring storms, particularly in Oklahoma, resulting in a 124% combined ratio for the quarter. Despite a net loss of $4 million, the company improved its expense ratio to 32%, down 580 basis points from the previous year, and increased net investment income by 11% to $1.5 million. The management emphasized their commitment to operational profitability, supported by ongoing expense reductions and potential asset sales for liquidity needs.

Conifer Holdings Corporate Events

Executive/Board ChangesBusiness Operations and Strategy

Conifer Holdings Secures Leadership with Extended Contracts

Positive

Dec 19, 2024

Conifer Holdings, Inc. has entered into amended and restated employment agreements with its President and CEO, Brian Roney, and CFO, Harold Meloche, extending their terms through June 2027. The agreements include structured cash bonuses and revised severance benefits, indicating a strategic move to secure key leadership and potentially stabilize company operations amidst market changes.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.