Education
About Us
Working with TipRanks
Follow Us
Erie Indemnity (ERIE)
:ERIE
Top Page
Erie Indemnity Company
(NASDAQ:ERIE)
Select Model
Select Model
Rating:70Outperform
Price Target:
$385.00
▲(21.67% Upside)
Erie Indemnity Company's strong financial performance and positive earnings call highlights are offset by bearish technical indicators and a relatively high valuation. The company's robust financial health and strategic achievements are significant strengths, but market sentiment and valuation concerns weigh on the overall score.
Positive Factors
Revenue Growth
Sustained premium growth indicates strong demand for ERIE's insurance products, enhancing revenue stability and market position.
Financial Health
A strong balance sheet with high equity and no debt enhances ERIE's financial resilience and ability to invest in growth opportunities.
Management Fee Revenue
Growth in management fee revenue underscores ERIE's effective operations and ability to capitalize on its role in the insurance exchange.
Negative Factors
Cybersecurity Incident
A cybersecurity incident, despite no data breach, highlights vulnerabilities that could impact trust and operational continuity.
Increased Operating Costs
Rising operating costs, driven by higher commissions and IT expenses, could pressure margins and reduce profitability.
Weather-Related Losses
Increased weather-related losses elevate the combined ratio, potentially impacting underwriting profitability and financial results.
Erie Indemnity Company (ERIE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$13.78B
Dividend Yield1.84%
Average Volume (3M)149.96K
Price to Earnings (P/E)24.1
Beta (1Y)0.35
Revenue Growth9.64%
EPS Growth15.87%
CountryUS
Employees6,715
SectorFinancial
Sector Strength70
IndustryInsurance - Brokers
Share Statistics
EPS (TTM)3.50
Shares Outstanding46,189,068
10 Day Avg. Volume123,099
30 Day Avg. Volume149,959
Financial Highlights & Ratios
PEG Ratio0.92
Price to Book (P/B)9.58
Price to Sales (P/S)5.02
P/FCF Ratio39.15
Enterprise Value/Market Cap1.17
Enterprise Value/Revenue3.88
Enterprise Value/Gross Profit6.01
Enterprise Value/Ebitda40.78
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)12.46
Revenue Forecast (FY)$4.09B
Erie Indemnity Company Business Overview & Revenue Model
Company DescriptionErie Indemnity Company (ERIE) is a publicly traded company based in Erie, Pennsylvania, primarily operating in the insurance sector. It serves as the management company for the Erie Insurance Exchange, offering a range of insurance products including auto, home, life, and commercial insurance. ERIE is known for its commitment to customer service and operates through a network of independent agents, providing tailored insurance solutions to its policyholders.
How the Company Makes MoneyErie Indemnity Company generates revenue primarily through its management fee, which is a percentage of the premiums collected by the Erie Insurance Exchange. This fee is charged for managing the exchange's underwriting operations and claims management. In addition to management fees, ERIE earns income from investment activities, where it invests the premiums received before claims are paid out. The company also benefits from its strong partnerships with independent agents, which help drive policy sales and enhance customer reach. Furthermore, ERIE's focus on customer retention and satisfaction contributes to a stable revenue stream, as long-term policyholders renew their insurance coverage.
Erie Indemnity Company Earnings Call Summary
Earnings Call Date:Oct 30, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 26, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted significant strides in returning to profitability and growth, evidenced by increased premiums, net income, and new product introductions. However, challenges remain with the adjustment in financial strength rating due to severe weather impacts and claims severity. Industry recognition and awards positively reflect the company's standing.Q3-2025 Updates
Positive Updates
Return to Profitability
This quarter marks a meaningful step forward in Erie's return to profitability, with a combined ratio of 100.6% compared to 113.7% last year, reflecting steady progress toward sustainable profitability.
Growth in Direct Written Premiums
The Exchange's direct written premiums grew 7.6% in the quarter and 10.1% year-to-date, with the average premium per policy increasing 10.7%.
Increase in Net and Operating Income
Net income for the third quarter was $183 million, a 14% increase from last year, and operating income grew by 16%, driven by higher management fee revenue.
Introduction of Enhanced Auto Product
The introduction of ErieSecure Auto is expected to positively impact competitive position and growth, with impressive impacts seen in Ohio and plans for deployment in additional states.
Industry Recognition and Awards
Erie received several industry accolades, including top rankings in J.D. Power's 2025 U.S. Small Commercial Insurance Study, Forbes list of America's Best Insurance Companies 2026, and recognition as one of America's Greatest Companies 2025.
Negative Updates
Adjustment in Financial Strength Rating
A.M. Best adjusted Erie's financial strength rating from A+ (Superior) to A (Excellent), primarily due to profitability challenges from large underwriting losses driven by severe weather events and increased claims severity.
Impact of Severe Weather Events on Underwriting Losses
Severe weather-related events in 2023 and 2024 were nearly double historical levels, contributing to elevated underwriting losses, with a significant hailstorm causing $370 million in insured losses.
Challenges in Rate Increases Keeping Pace with Claims Severity
Claims severity in both auto and homeowners grew faster than rate increases, posing a challenge to profitability despite efforts to adjust rates competitively.
Company Guidance
During the Erie Indemnity Company's third quarter 2025 earnings call, several key financial metrics and strategic initiatives were highlighted. The company reported a 7.6% growth in direct written premiums for the quarter and a 10.1% increase year-to-date, with the average premium per policy rising by 10.7% over two years. Policy growth was modest at 0.2%, with a retention rate of 89.1%. The combined ratio improved to 100.6% for the quarter from 113.7% the previous year, indicating progress in restoring profitability. Net income for the third quarter was $183 million, or $3.50 per diluted share, a 14% increase from the prior year, while year-to-date net income rose 11% to $496 million, or $9.48 per diluted share. Operating income was up 16% to $209 million for the quarter, driven by a 7.3% increase in management fee revenue. Additionally, the company's surplus grew by over $300 million, reaching $9.6 billion, underscoring its robust capital position. Erie also announced the launch of ErieSecure Auto, an enhanced auto product, aimed at boosting competitiveness and growth, initially piloted in Ohio with plans to expand to other states.Erie Indemnity Company Financial Statement Overview
Summary
Erie Indemnity Company displays a commendable financial position with consistent revenue growth, excellent profitability, and a strong balance sheet free from debt. The cash flow generation is solid, enhancing the company's financial flexibility and resilience.Income Statement
Erie Indemnity Company demonstrates consistent revenue growth with a TTM increase of 2.8% from the previous year. The company maintains a strong gross profit margin of 51.1% and a net profit margin of 18.5% in the TTM. EBIT and EBITDA margins are stable, indicating efficient management of expenses. The company shows resilience with improved profitability metrics.85
Very Positive
Balance Sheet
The balance sheet is robust with a high equity ratio of 69.6%, indicating financial stability. The absence of debt and a strong return on equity of 29.7% in the TTM highlight efficient equity utilization and low financial risk. The company maintains a solid asset base and liquidity position.90
Very Positive
Cash Flow
The cash flow statement shows healthy free cash flow growth of 4.9% in the TTM. The operating cash flow to net income ratio is favorable at 1.05, indicating strong cash generation from operations. The free cash flow to net income ratio supports the company's ability to generate cash relative to net earnings.82
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.15B | 3.86B | 3.31B | 2.85B | 2.67B | 2.57B |
| Gross Profit | 2.68B | 3.86B | 3.31B | 2.85B | 2.67B | 2.57B |
| EBITDA | 395.49M | 821.19M | 615.53M | 430.18M | 429.63M | 403.55M |
| Net Income | 647.98M | 600.31M | 446.06M | 298.57M | 297.86M | 293.30M |
Balance Sheet | ||||||
| Total Assets | 3.32B | 2.89B | 2.47B | 2.24B | 2.24B | 2.12B |
| Cash, Cash Equivalents and Short-Term Investments | 628.38M | 319.44M | 226.07M | 166.36M | 222.10M | 178.94M |
| Total Debt | 0.00 | 7.51M | 0.00 | 122.50M | 93.83M | 95.86M |
| Total Liabilities | 1.02B | 901.36M | 809.13M | 791.05M | 899.58M | 929.07M |
| Stockholders Equity | 2.31B | 1.99B | 1.66B | 1.45B | 1.34B | 1.19B |
Cash Flow | ||||||
| Free Cash Flow | 576.99M | 486.40M | 288.56M | 298.95M | 253.99M | 287.07M |
| Operating Cash Flow | 708.56M | 611.25M | 381.20M | 366.15M | 402.79M | 342.60M |
| Investing Cash Flow | -157.56M | -226.91M | -157.56M | -106.92M | -185.49M | -243.22M |
| Financing Cash Flow | -203.66M | -230.00M | -221.68M | -300.84M | -194.84M | -274.87M |
Erie Indemnity Company Technical Analysis
Neutral
316.42
Price Trends
305.13
Negative
326.26
Negative
352.80
Negative
Market Momentum
-2.97
Negative
49.43
Neutral
65.01
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ERIE, the sentiment is Neutral. The current price of 316.42 is above the 20-day moving average (MA) of 288.99, above the 50-day MA of 305.13, and below the 200-day MA of 352.80, indicating a neutral trend. The MACD of -2.97 indicates Negative momentum. The RSI at 49.43 is Neutral, neither overbought nor oversold. The STOCH value of 65.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ERIE.
Erie Indemnity Company Risk Analysis
Erie Indemnity Company disclosed 11 risk factors in its most recent earnings report. Erie Indemnity Company reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Erie Indemnity Company Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $27.26B | 23.96 | 10.47% | 0.77% | 17.87% | -9.35% | |
71 Outperform | $89.83B | 21.99 | 28.62% | 1.87% | 10.57% | 2.57% | |
70 Outperform | $13.78B | 24.06 | 30.44% | 1.84% | 9.64% | 15.87% | |
70 Outperform | $62.72B | 38.86 | 9.05% | 0.97% | 17.17% | 19.12% | |
69 Neutral | $30.23B | 15.07 | 27.79% | 1.15% | ― | ― | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
66 Neutral | $74.30B | 27.69 | 38.33% | 0.84% | 14.06% | 5.52% |
* Financial Sector Average
ERIE
Erie Indemnity Company
296.21
-124.25
-29.55%
AON
Aon
344.45
-34.43
-9.09%
AJG
Arthur J Gallagher & Co
245.36
-59.44
-19.50%
BRO
Brown & Brown
79.65
-30.78
-27.87%
MMC
Marsh & Mclennan Companies
183.87
-42.26
-18.69%
WTW
Willis Towers Watson
316.53
-12.27
-3.73%
Erie Indemnity Company Corporate Events
Erie Indemnity’s Earnings Call: Growth Amid Challenges
Sep 1, 2025
The recent earnings call for Erie Indemnity painted a mixed picture, balancing notable achievements with significant challenges. While the company celebrated growth in premiums and income, alongside prestigious recognitions, it also faced hurdles such as a cybersecurity incident, increased weather-related losses, and rising operational costs.
Erie Indemnity Reports Strong Financial Growth in 2025
Aug 9, 2025
Erie Indemnity Company, a leading provider of insurance services, operates primarily in the property and casualty insurance sector, offering a range of policy issuance and renewal services across 12 states and the District of Columbia.
DividendsFinancial Disclosures
Erie Indemnity Declares Quarterly Dividend Amid Income Growth
Positive
Aug 7, 2025
On July 29, 2025, Erie Indemnity Company‘s Board of Directors declared a quarterly dividend of $1.365 per share on its Class A common stock, payable on October 21, 2025. The company reported a net income of $174.7 million for the second quarter of 2025, an increase from $163.9 million in the same period in 2024. For the first half of 2025, net income was $313.1 million, up from $288.5 million in the first half of 2024. Operating income and management fee revenue both saw significant increases, driven by growth in direct and affiliated assumed written premium. Investment income also rose, contributing to the overall financial growth.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.