Employers Holdings (EIG) AI Stock Analysis

• Market Cap: $989.84M
• Dividend Yield: 2.97%
• Average Volume (3M): 205.32K
• Price to Earnings (P/E): 10.2
• Beta (1Y): 0.48
• Revenue Growth: 2.32%
• EPS Growth: -11.91%
• Country: US
• Employees: 715
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Specialty
• EPS (TTM): 0.48
• Shares Outstanding: 23,511,590
• 10 Day Avg. Volume: 279,757
• 30 Day Avg. Volume: 205,320
• 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: 1.15
• Enterprise Value/Revenue: 1.28
• Enterprise Value/Gross Profit: 1.81
• Enterprise Value/Ebitda: 9.06
• 1Y Price Target: $49.00
• Price Target Upside: 17.34% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 72 Outperform
• Price Target: ―

Employers Holdings showcases a strong financial foundation with significant revenue and profit growth, underpinned by a debt-free balance sheet and efficient cash management. While technical indicators suggest stability, valuation metrics reflect an attractive investment opportunity. The recent earnings call provides a balanced view of growth potential and challenges, resulting in an overall encouraging but cautious outlook.

Positive Factors

Strong Balance Sheet

A debt-free balance sheet enhances financial stability, allowing the company to navigate economic fluctuations and invest in growth opportunities without the burden of interest payments.

Record Policy Growth

Achieving record policy growth indicates strong market demand and effective sales strategies, which can lead to increased revenue and market share over time.

Increase in Net Investment Income

A significant rise in investment income enhances profitability and provides additional financial resources to support strategic initiatives and shareholder returns.

Negative Factors

Flat Net Premium Growth

Flat net premium growth suggests challenges in expanding the customer base or increasing policy pricing, potentially limiting revenue growth and profitability.

Increased Loss Ratios

Rising loss ratios indicate higher claims costs, which can pressure profit margins and require adjustments in underwriting or pricing strategies to maintain financial performance.

Unrealized Investment Losses

Unrealized investment losses can affect reported earnings and shareholder equity, potentially impacting investor perception and financial flexibility.

Employers Holdings Business Overview & Revenue Model

Company Description

Employers Holdings, Inc., through its subsidiaries, operates in the commercial property and casualty insurance industry primarily in the United States. It offers workers' compensation insurance to small businesses in low to medium hazard industries. The company markets its products through independent local, regional, and national agents and brokers; alternative distribution channels; and national, regional, and local trade groups and associations, as well as directly to customers. Employers Holdings, Inc. was founded in 2000 and is based in Reno, Nevada.

How the Company Makes Money

Employers Holdings, Inc. generates revenue primarily through the underwriting and sale of workers' compensation insurance policies. The company's revenue model is based on collecting premiums from policyholders, which are calculated based on factors such as the size of the payroll, industry classification, and claims history of the insured businesses. In addition to premiums, EIG also earns investment income from the reserves held to pay future claims. The company's profitability is influenced by its ability to effectively manage claims costs, administrative expenses, and investment returns. Strategic partnerships with independent insurance agencies and brokers are also crucial in expanding EIG's market reach and customer base.

Employers Holdings Financial Statement Overview

Summary

Employers Holdings demonstrates strong financial performance across income, balance sheet, and cash flow statements. Revenue growth is steady, the balance sheet is robust with no debt, and cash flow management is efficient, although lack of capital expenditures could impact future growth.

Income Statement

Employers Holdings shows a solid revenue growth rate of 3.51% from 2023 to 2024, indicating a positive trajectory. The company maintains a strong gross profit margin at 100% due to its business model, which is typical in the insurance industry. The net profit margin remains stable at around 13.47% in 2024. However, the absence of EBITDA data for 2024 limits a complete profitability analysis. Overall, the income statement reflects a healthy financial position with consistent growth and profitability.

Balance Sheet

Employers Holdings has a strong balance sheet with no total debt reported in 2024 and a debt-to-equity ratio of 0, indicating no reliance on leverage. The equity ratio of 30.18% in 2024 shows a solid equity base. ROE is stable at 11.10% in 2024, suggesting efficient use of shareholder equity to generate profits. The company's financial stability is reinforced by a significant cash position, enhancing its ability to manage liabilities effectively.

Cash Flow

The company exhibits a significant growth in operating cash flow from 2023 to 2024, increasing by 75.51%, which is a positive indicator of cash-generating capability. The free cash flow to net income ratio is strong at 73.10% in 2024, reflecting efficient cash flow management. However, the absence of capital expenditures in 2024 raises questions about future investment in growth. Overall, the cash flows indicate robust operational performance with strategic cash usage.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	889.50M	880.70M	850.90M	713.50M	703.10M	711.40M
Gross Profit	631.70M	424.50M	850.90M	713.50M	703.10M	711.40M
EBITDA	126.00M	146.80M	0.00	627.20M	169.10M	165.30M
Net Income	101.10M	118.60M	118.10M	48.40M	119.30M	119.80M
Balance Sheet
Total Assets	3.14B	3.54B	3.55B	3.72B	3.78B	3.92B
Cash, Cash Equivalents and Short-Term Investments	2.53B	1.02B	913.20M	208.30M	85.60M	187.00M
Total Debt	0.00	4.30M	5.90M	182.50M	16.60M	20.00M
Total Liabilities	2.05B	2.47B	2.54B	2.77B	2.57B	2.71B
Stockholders Equity	1.08B	1.07B	1.01B	944.20M	1.21B	1.21B
Cash Flow
Free Cash Flow	75.20M	71.50M	47.20M	97.20M	7.20M	27.80M
Operating Cash Flow	78.70M	76.40M	49.40M	99.80M	10.80M	33.30M
Investing Cash Flow	-11.90M	-159.70M	377.30M	-146.10M	-1.70M	84.30M
Financing Cash Flow	-93.20M	-74.80M	-289.50M	60.40M	-94.40M	-112.20M

Employers Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 41.76
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EIG, the sentiment is Negative. The current price of 41.76 is below the 20-day moving average (MA) of 42.32, below the 50-day MA of 42.76, and below the 200-day MA of 46.94, indicating a bearish trend. The MACD of -0.24 indicates Negative momentum. The RSI at 44.23 is Neutral, neither overbought nor oversold. The STOCH value of 52.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EIG.

Employers Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NMIH	81 Outperform	3.07B	8.31	15.61%	―	9.99%	11.47%
EIG	72 Outperform	$989.84M	10.25	9.60%	2.97%	2.32%	-11.91%
ITIC	72 Outperform	490.26M	14.85	12.34%	6.14%	15.28%	26.05%
AMSF	72 Outperform	828.18M	16.54	―	10.53%	-0.86%	-11.19%
MBI	56 Neutral	383.71M	-1.65	10.33%	―	―	66.83%
JRVR	51 Neutral	264.97M	-1.77	-14.35%	0.72%	-20.88%	1.34%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Employers Holdings Corporate Events

Employers Holdings Appoints Marvin Pestcoe to Board

On March 3, 2025, Employers Holdings, Inc. announced the appointment of Marvin Pestcoe to its Board of Directors, where he will also serve on the Audit Committee and the Board Governance and Nominating Committee. Pestcoe brings over 40 years of experience in insurance, reinsurance, and investments, having held executive roles at Langhorne Re, Partner Re, and Swiss Re New Markets. His extensive expertise is expected to significantly benefit the company. Concurrently, long-serving board members Michael J. McSally and James R. Kroner announced their retirement from the board, effective the same day, after years of distinguished service.