Selective Insurance Group (SIGI) AI Stock Analysis

• Market Cap: $4.74B
• Dividend Yield: 1.92%
• Average Volume (3M): 690.99K
• Price to Earnings (P/E): 12.7
• Beta (1Y): 0.30
• Revenue Growth: 12.27%
• EPS Growth: 66.53%
• Country: US
• Employees: 2,800
• Sector: Financial
• Sector Strength: 72
• Industry: Insurance - Property & Casualty
• EPS (TTM): 1.31
• Shares Outstanding: 60,850,304
• 10 Day Avg. Volume: 507,157
• 30 Day Avg. Volume: 690,989
• 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: 1.35
• Enterprise Value/Revenue: 1.25
• Enterprise Value/Gross Profit: 2.29
• Enterprise Value/Ebitda: 11.61
• 1Y Price Target: $82.60
• Price Target Upside: 4.50% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5

• Rating: 75 Outperform
• Price Target: $88.00 ▲(11.34% Upside)

Selective Insurance Group's overall stock score reflects strong financial performance and attractive valuation, tempered by technical indicators suggesting a bearish trend. The company's strategic initiatives and recent corporate events provide a positive outlook, but challenges highlighted in the earnings call warrant attention. The balance of strengths and risks results in a moderate overall score.

Positive Factors

Commercial Auto

Commercial Auto reserving concerns are viewed as manageable due to increased earned premiums from higher renewal pricing.

Management Actions

Prudent management actions from Selective are seen going forward based on the appropriate reserving actions taken by management.

Reserving Improvement

The overall reserving is improving, likely due in part to the deceleration of social inflation frequency.

Negative Factors

Profitability Challenges

As the company works through current profitability and growth challenges, the share price is expected to underperform peers.

Reserve Charges

Multiple adverse reserve charges and continued social inflation headwinds should pressure combined ratio in the high 90s for 2025, and potentially 2026.

Stock Rating

The stock rating has been downgraded from equal-weight to underweight.

Selective Insurance Group Business Overview & Revenue Model

Company Description

Selective Insurance Group, Inc., together with its subsidiaries, provides insurance products and services in the United States. It operates through four segments: Standard Commercial Lines, Standard Personal Lines, E&S Lines, and Investments. The company offers property insurance products, which covers the financial consequences of accidental loss of an insured's real property, personal property, and/or earnings due to the property's loss; and casualty insurance products that covers the financial consequences of employee injuries in the course of employment, and bodily injury and/or property damage to a third party, as well as flood insurance products. It also invests in fixed income investments and commercial mortgage loans, as well as equity securities and alternative investment portfolio. The company offers its insurance products and services to businesses, non-profit organizations, local government agencies, and individuals through independent retail agents and wholesale general agents. Selective Insurance Group, Inc. was founded in 1926 and is headquartered in Branchville, New Jersey.

How the Company Makes Money

Selective Insurance Group generates revenue primarily through the underwriting of insurance premiums. The company collects premiums from policyholders in exchange for providing coverage against various risks. Its key revenue streams include personal lines (such as homeowners and auto insurance), commercial lines (including business owners' policies, workers' compensation, and liability insurance), and specialty insurance products. Additionally, SIGI invests the premiums it collects in various financial instruments, generating investment income. The company also benefits from significant partnerships with independent agents and brokers, which help distribute its insurance products, thereby enhancing its market reach and revenue potential. Furthermore, effective risk management practices and loss control measures contribute to reducing claims expenses, thereby improving overall profitability.

Selective Insurance Group Financial Statement Overview

Summary

Selective Insurance Group exhibits strong financial health with consistent revenue growth, solid profitability, and a stable balance sheet. The company maintains effective cost management and prudent financial leverage. While the decline in free cash flow growth is a point of concern, the overall financial position remains robust, supporting continued operational success.

Income Statement

Selective Insurance Group shows a stable revenue growth rate with a TTM (Trailing-Twelve-Months) increase of 2.62%. The gross profit margin remains strong at 54.71% in TTM, indicating efficient cost management. However, the net profit margin has slightly decreased to 7.50% in TTM, suggesting some pressure on profitability. Overall, the company demonstrates solid revenue growth and profitability, though there is room for improvement in net profit margins.

Balance Sheet

The company's balance sheet is robust, with a low debt-to-equity ratio of 0.27 in TTM, reflecting prudent financial leverage. Return on equity is healthy at 11.88% in TTM, showcasing effective use of equity to generate profits. The equity ratio stands at 23.29%, indicating a strong equity base relative to total assets. Overall, the balance sheet reflects financial stability and effective capital management.

Cash Flow

The cash flow statement indicates a slight decline in free cash flow growth at -8.01% in TTM, which could be a concern if it persists. However, the operating cash flow to net income ratio is strong at 88.71, suggesting efficient cash generation relative to net income. The free cash flow to net income ratio is nearly 1, indicating that the company effectively converts its earnings into cash. Overall, cash flow generation is solid, but the decline in free cash flow growth warrants monitoring.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.11B	4.86B	4.23B	3.56B	3.38B	2.92B
Gross Profit	2.80B	321.30M	4.22B	3.55B	3.38B	2.92B
EBITDA	552.30M	321.71M	517.25M	351.37M	589.58M	393.18M
Net Income	383.65M	207.01M	365.24M	224.89M	403.84M	246.35M
Balance Sheet
Total Assets	14.47B	13.51B	11.80B	10.80B	10.46B	9.69B
Cash, Cash Equivalents and Short-Term Investments	8.88B	268.58M	180.00K	26.00K	455.00K	394.00K
Total Debt	902.70M	555.67M	503.95M	504.68M	506.05M	550.74M
Total Liabilities	9.97B	10.39B	8.85B	8.27B	7.48B	6.95B
Stockholders Equity	3.37B	3.12B	2.95B	2.53B	2.98B	2.74B
Cash Flow
Free Cash Flow	1.13B	1.07B	736.28M	776.39M	749.26M	531.98M
Operating Cash Flow	1.17B	1.10B	758.91M	802.41M	771.42M	554.04M
Investing Cash Flow	-1.41B	-947.38M	-686.36M	-734.45M	-618.78M	-688.17M
Financing Cash Flow	270.43M	-102.75M	-84.49M	-87.82M	-122.81M	141.38M

Selective Insurance Group Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 79.04
• 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 SIGI, the sentiment is Neutral. The current price of 79.04 is above the 20-day moving average (MA) of 77.78, below the 50-day MA of 82.10, and below the 200-day MA of 87.39, indicating a neutral trend. The MACD of -1.10 indicates Negative momentum. The RSI at 49.17 is Neutral, neither overbought nor oversold. The STOCH value of 63.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SIGI.

Selective Insurance Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PLMR	83 Outperform	$3.27B	21.44	22.45%	―	52.60%	50.69%
THG	81 Outperform	$6.19B	11.40	19.23%	2.03%	4.47%	102.98%
RLI	76 Outperform	$6.20B	19.34	19.49%	3.80%	10.29%	-4.70%
SIGI	75 Outperform	$4.74B	12.65	12.19%	1.92%	12.27%	66.53%
WTM	69 Neutral	$4.73B	22.71	4.47%	0.05%	8.08%	-57.76%
Sector *	68 Neutral	$17.84B	12.03	10.32%	3.73%	9.70%	0.76%
KMPR	58 Neutral	$3.34B	9.97	12.21%	2.37%	2.75%	572.22%

Selective Insurance Group Corporate Events

Wole Coaxum Resigns from Selective Insurance Board

On July 30, 2025, Wole Coaxum resigned from Selective Insurance Group‘s Board of Directors to focus on his role at Mobility Capital Finance Inc. His departure, which was not due to any disagreements with the company, leaves the board with 11 directors, 10 of whom are independent. Coaxum’s resignation is acknowledged by Selective’s leadership, who express gratitude for his contributions and confidence in the company’s strategic direction and ability to deliver value to shareholders.

Selective Insurance Group Reports Q2 2025 Financial Results

Selective Insurance Group reported its financial results for the second quarter of 2025, showing a net income per diluted common share of $1.36 and a non-GAAP operating income of $1.31 per share. The company achieved a return on equity of 10.7% and a non-GAAP operating return on equity of 10.3%. Notably, net premiums written increased by 5% compared to the same quarter in 2024, driven by renewal pure price increases. The GAAP combined ratio improved to 100.2% from 116.1% in the previous year, reflecting pressures from social inflation and reserve strengthening in commercial lines. Selective’s strategic initiatives and disciplined approach are aimed at delivering profitable growth in the current market environment.

Selective Insurance Group Secures New Credit Agreement

On June 30, 2025, Selective Insurance Group, Inc. entered into a new Credit Agreement with Wells Fargo Bank and other lenders, securing a $100 million revolving credit facility, expandable to $200 million. This agreement, which matures on June 30, 2028, replaces a prior credit agreement from November 2022, which provided a $50 million facility. The new agreement includes customary financial covenants and events of default, positioning Selective for enhanced financial flexibility without incurring penalties from the termination of the previous agreement.