Donegal Group (DGICA) AI Stock Analysis

• Market Cap: $695.93M
• Dividend Yield: 3.61%
• Average Volume (3M): 148.88K
• Price to Earnings (P/E): 8.2
• Beta (1Y): 0.18
• Revenue Growth: 3.40%
• EPS Growth: 978.24%
• Country: US
• Employees: 410
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Property & Casualty
• EPS (TTM): 0.43
• Shares Outstanding: 30,931,854
• 10 Day Avg. Volume: 115,585
• 30 Day Avg. Volume: 148,878
• PEG Ratio: 0.01
• Price to Book (P/B): 0.94
• Price to Sales (P/S): 0.52
• P/FCF Ratio: 7.57
• Enterprise Value/Market Cap: 1.10
• Enterprise Value/Revenue: 0.77
• Enterprise Value/Gross Profit: 1.21
• Enterprise Value/Ebitda: 7.16
• 1Y Price Target: $20.50
• Price Target Upside: 5.34% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 75 Outperform
• Price Target: $22.00 ▲(13.05% Upside)

Donegal Group's strong financial performance and attractive valuation are the most significant factors driving the score. The company's robust balance sheet and low leverage enhance its financial stability. Technical analysis supports a positive outlook with bullish momentum. The absence of earnings call data and corporate events does not impact the overall assessment.

Donegal Group Business Overview & Revenue Model

Company Description

Donegal Group Inc. (DGICA) is a regional property and casualty insurance holding company based in the United States, primarily focused on providing insurance products through its subsidiaries. The company operates in the insurance sector, offering a range of products including personal and commercial auto insurance, homeowners insurance, and other specialty insurance services. Donegal Group serves a diverse customer base, predominantly in the Mid-Atlantic and Midwest regions, and is committed to delivering high-quality insurance solutions tailored to the needs of its policyholders.

How the Company Makes Money

Donegal Group generates revenue primarily through the underwriting of insurance policies. The company earns premium income from policyholders who pay for coverage against potential risks, such as property damage or liability claims. Key revenue streams include personal and commercial lines of insurance, with a significant portion of income derived from premiums collected. Additionally, Donegal Group invests the funds it collects from premiums, generating investment income from its investment portfolio. This diversified approach to revenue, combining underwriting profits with investment returns, is crucial for the company's financial stability. The company's partnerships with independent agents and brokers also play a significant role in expanding its market reach and enhancing sales, ultimately contributing to its earnings.

Donegal Group Financial Statement Overview

Summary

Donegal Group demonstrates a solid financial position with strong cash flow and improving profitability. The income statement reflects positive growth trends, while the balance sheet indicates a conservative approach to debt. The company is well-positioned to leverage its financial stability for future expansion, though there is room for operational efficiency improvements.

Income Statement

The company's income statement shows a strong gross profit margin of 82.8% for TTM (Trailing-Twelve-Months), indicating efficient cost management. The net profit margin improved to 7.1% compared to previous periods, reflecting better profitability. Revenue growth rate is solid at 7.5% over the last year, showing positive momentum. However, the EBIT and EBITDA margins, at 8.7% and 9.2% respectively, suggest room for operational improvements.

Balance Sheet

The balance sheet is stable with a low debt-to-equity ratio of 0.06, indicating low leverage, which is favorable in the insurance industry. Return on equity stands at 12.0%, demonstrating reasonable shareholder returns. The equity ratio of 24.7% indicates a moderate level of equity financing. Overall, the balance sheet reflects a conservative financial structure with potential for growth.

Cash Flow

Cash flow metrics are strong, with a significant free cash flow growth rate of 31.0% in the TTM period, highlighting robust cash generation. The operating cash flow to net income ratio of 1.26 indicates efficient conversion of income into cash. Additionally, the free cash flow to net income ratio of 1.26 underscores solid cash management practices.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	994.01M	989.61M	927.34M	848.22M	816.47M	777.82M
Gross Profit	632.33M	989.61M	927.34M	848.22M	816.47M	777.82M
EBITDA	106.54M	67.16M	10.01M	1.82M	37.07M	71.19M
Net Income	82.82M	50.86M	4.43M	-1.96M	25.25M	52.82M
Balance Sheet
Total Assets	2.41B	2.34B	2.27B	2.24B	2.26B	2.16B
Cash, Cash Equivalents and Short-Term Investments	468.20M	401.92M	645.45M	606.24M	603.03M	679.13M
Total Debt	35.00M	35.00M	35.00M	35.00M	35.00M	90.00M
Total Liabilities	1.80B	1.79B	1.79B	1.76B	1.72B	1.64B
Stockholders Equity	605.67M	545.78M	479.75M	483.59M	531.04M	517.77M
Cash Flow
Free Cash Flow	78.82M	67.44M	28.58M	67.11M	76.73M	101.04M
Operating Cash Flow	78.82M	67.44M	28.62M	67.11M	76.73M	101.13M
Investing Cash Flow	-65.79M	-48.04M	-16.71M	-98.50M	-62.20M	-99.68M
Financing Cash Flow	20.18M	9.73M	-13.25M	-1.20M	-59.92M	52.32M

Donegal Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 19.46
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DGICA, the sentiment is Positive. The current price of 19.46 is above the 20-day moving average (MA) of 19.31, above the 50-day MA of 18.30, and above the 200-day MA of 17.68, indicating a bullish trend. The MACD of 0.27 indicates Positive momentum. The RSI at 61.91 is Neutral, neither overbought nor oversold. The STOCH value of 77.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DGICA.

Donegal Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HRTG	82 Outperform	$770.48M	7.32	33.49%	―	9.35%	77.04%
SAFT	80 Outperform	$1.04B	12.25	10.08%	5.17%	18.52%	65.66%
UFCS	79 Outperform	$796.63M	8.74	11.68%	2.08%	14.28%	148.61%
DGICA	75 Outperform	$695.93M	8.17	15.20%	3.61%	3.40%	978.24%
UVE	72 Outperform	$841.34M	12.42	15.60%	2.59%	5.64%	-17.95%
ACIC	70 Outperform	$577.87M	7.18	31.54%	―	23.68%	16.14%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Donegal Group Corporate Events

Donegal Group Declares Quarterly Cash Dividend

On July 17, 2025, Donegal Group Inc. announced a regular quarterly cash dividend of $0.1825 per share for Class A common stock and $0.165 per share for Class B common stock, payable on August 15, 2025, to stockholders of record as of August 1, 2025. This announcement reflects the company’s ongoing commitment to delivering value to its shareholders and maintaining its strong financial performance.

Donegal Group to Release Q2 2025 Financial Results

On July 2, 2025, Donegal Group Inc. announced it will release its second-quarter 2025 financial results on July 24, 2025, before NASDAQ market opening. The company will also provide a supplemental investor presentation and a pre-recorded audio webcast featuring management commentary, addressing pre-submitted questions, to offer insights into its financial performance and strategic direction.