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Intact Financial (TSE:IFC)
:IFC

Intact Financial Corporation (IFC) AI Stock Analysis

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Intact Financial Corporation

(TSX:IFC)

Rating:76Outperform
Price Target:
C$352.00
▲(12.84%Upside)
Intact Financial Corporation's overall score reflects strong financial performance and strategic corporate actions. The company shows robust profitability and operational efficiency, though concerns about revenue decline and high valuation persist. Positive technical indicators and corporate events support a favorable outlook, but challenges noted in the earnings call warrant caution.
Positive Factors
Financial Performance
Intact Financial's strong track record of prudent reserving practices contributes to better-than-expected reserve development.
Market Positioning
Intact Financial exhibits strong defensive characteristics and competitive advantage in data analytics, contributing to its superior market positioning.
Negative Factors
CAT Losses
The announcement of CAT losses of $244 million, driven by weather events and commercial fires, is higher than previously estimated.
Market Conditions
The outsized CAT losses are expected to prolong firm market conditions, especially in personal property.

Intact Financial Corporation (IFC) vs. iShares MSCI Canada ETF (EWC)

Intact Financial Corporation Business Overview & Revenue Model

Company DescriptionIntact Financial Corporation, through its subsidiaries, provides property and casualty insurance products to individuals and businesses in Canada, the United States, the United Kingdom, Ireland, rest of Europe, and the Middle East. It offers personal auto insurance; insurance for motor homes, recreational vehicles, motorcycles, snowmobiles, and all-terrain vehicles; personal property insurance, such as protection for homes and contents from risks, including fire, theft, vandalism, water damage, and other damages, as well as personal liability coverage; and property coverage for tenants, condominium owners, non-owner occupied residences, and seasonal residences. The company also provides insurance products for commercial lines for a group of small and medium sized businesses; commercial property insurance for the protection of physical assets of the business; and liability coverages comprising commercial general, product, and professional liability, as well as cyber endorsement. In addition, it offers commercial vehicle insurance coverages for the protection for commercial auto, fleets, garage operations, light trucks, public vehicles, and the specific needs of the sharing economy. Further, the company provides various personal levels of coverage to customers for their home, motor, pet, and other insurance products; general insurance, specialty lines, and risk management solutions; specialty insurance products for various product and customer groups, including accident and health, technology, ocean and inland marine, public entities, and entertainment, as well as financial services and institutions; and various products to specialty property, surety, tuition reimbursement, management liability, cyber, and environmental institutions. The company was formerly known as ING Canada Inc. and changed its name to Intact Financial Corporation in 2009. Intact Financial Corporation was founded in 1809 and is based in Toronto, Canada.
How the Company Makes MoneyIntact Financial Corporation generates revenue primarily through the underwriting and selling of insurance policies. These revenues are derived from premiums collected from policyholders who seek protection against various risks. The company's key revenue streams include personal insurance products, such as auto and home insurance, and commercial insurance offerings that cater to businesses of all sizes. Additionally, IFC benefits from investment income by managing and investing the premiums collected until claims are paid out. Strategic acquisitions and partnerships also play a significant role in expanding its market presence and enhancing its product offerings, contributing to its financial performance.

Intact Financial Corporation Earnings Call Summary

Earnings Call Date:May 06, 2025
(Q1-2025)
|
% Change Since: 0.87%|
Next Earnings Date:Jul 29, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed performance with significant achievements in net operating income, book value growth, and emission reductions. However, challenges persist in large account pressure, premium decreases in the UK&I and U.S., and elevated catastrophe losses. Despite these challenges, the company remains optimistic about future growth opportunities.
Q1-2025 Updates
Positive Updates
Increase in Net Operating Income Per Share
Reported a 10% increase in net operating income per share, achieving $4.01 with strong contributions across the business.
Growth in Book Value Per Share
Book value per share grew 4% from last quarter and 13% year-over-year.
Strong Combined Ratio in the U.S.
The combined ratio in the U.S. was strong at 86.8% despite weather-related challenges.
Emission Reduction Progress
Reported a 23% reduction in emissions, on track to achieve a 50% reduction by 2030.
Improvement in Underlying Current Accident Year Loss Ratio
The overall underlying current accident year loss ratio improved to 60.3% year-over-year.
Favorable Prior Year Development
Favorable prior year development was strong at 6.9%, reflecting continued prudent reserving across all segments.
Negative Updates
Pressure in Large Accounts
Continued pressure in large accounts across all jurisdictions, affecting growth in Commercial Lines.
Decreased Premiums in the UK&I
Premiums decreased by 4% in the UK&I due to remediation actions and competition in large accounts.
Elevated Catastrophe Losses
Reported $244 million of catastrophe losses in the first quarter, higher than expected due to two named storms in the UK&I and large commercial fires in the U.S.
Challenges in Personal Auto Industry
Profitability remains challenging in the Personal Auto industry, particularly in Alberta.
Decreased Premiums in the U.S.
Premiums decreased by 3% in the U.S., including a 5-point impact from the non-renewal of one large account.
Company Guidance
In the Intact Financial Corporation Q1 2025 Results Conference Call, the company reported a 10% increase in net operating income per share, reaching $4.01. The book value per share grew by 4% from the previous quarter and 13% year-over-year. Top line growth was 3% for the quarter, supported by momentum in Personal Lines with an 11% increase in Personal Auto premiums and a 9% rise in Personal Property premiums. The combined ratio was 91%, despite 2.5 points higher catastrophe losses. In Canada, the Personal Auto combined ratio was 97.5%, while Personal Property achieved an 88.9% combined ratio. The Commercial Lines combined ratio was 81.2% in Canada, with premium growth of 1%. In the UK, premiums decreased by 4%, while the combined ratio was 97.6%. In the U.S., premiums decreased by 3%, but the combined ratio was strong at 86.8%. The company highlighted strategic initiatives, including BrokerLink's expansion and the rebranding of RSA to Intact Insurance. Intact also reported a 23% reduction in emissions, with the goal of a 50% reduction by 2030. The company anticipates 10% net operating income per share growth annually and aims to outperform the industry return on equity by at least 500 basis points each year.

Intact Financial Corporation Financial Statement Overview

Summary
Intact Financial Corporation presents a strong financial foundation with healthy profitability margins and efficient cash flow management. While revenue decline is a concern, the company's operational efficiency and prudent leverage provide stability.
Income Statement
80
Positive
Intact Financial Corporation shows a robust income statement with a strong Gross Profit Margin of 104.8% TTM, indicating efficient cost management. The Net Profit Margin is healthy at 12.0% TTM, reflecting profitability. However, Total Revenue has decreased by 21.5% from the previous year, which could be a concern if the trend continues. The EBIT and EBITDA margins remain solid at 15.9% and 19.4% TTM, respectively, highlighting operational efficiency.
Balance Sheet
75
Positive
The balance sheet reveals a stable financial position with a moderate Debt-to-Equity Ratio of 0.29 TTM, showcasing prudent leverage. The Return on Equity stands at a strong 12.3%, indicating effective use of equity. However, the Equity Ratio is at 31.0% TTM, suggesting a balanced mix of debt and equity, though slightly lower equity backing could imply potential risk in volatility.
Cash Flow
85
Very Positive
Intact Financial Corporation demonstrates a solid cash flow position with a Free Cash Flow Growth Rate of 10.7%, indicating strong cash generation capabilities. The Operating Cash Flow to Net Income Ratio is 1.61 TTM, and the Free Cash Flow to Net Income Ratio is 1.42 TTM, both reflecting strong cash conversion and liquidity.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
19.19B24.44B22.07B21.15B17.48B12.46B
Gross Profit
20.11B513.00M22.09B21.15B17.48B12.46B
EBIT
3.06B2.88B1.80B3.12B1.87B897.00M
EBITDA
3.71B3.83B2.40B3.64B3.10B1.74B
Net Income Common Stockholders
2.30B2.30B1.32B2.45B2.07B1.08B
Balance SheetCash, Cash Equivalents and Short-Term Investments
2.56B18.90B17.94B23.85B25.00B2.47B
Total Assets
55.98B59.53B55.98B64.96B66.35B35.12B
Total Debt
5.74B5.47B5.74B5.14B5.87B3.49B
Net Debt
4.57B4.58B4.57B4.13B3.59B2.57B
Total Liabilities
39.50B41.38B39.50B49.27B49.57B25.54B
Stockholders Equity
16.19B18.15B16.19B15.40B15.67B9.58B
Cash FlowFree Cash Flow
3.28B2.96B1.39B3.25B2.80B2.19B
Operating Cash Flow
3.69B3.39B1.85B3.67B3.13B2.35B
Investing Cash Flow
-2.00B-1.61B-2.00B-2.75B-5.97B-2.44B
Financing Cash Flow
-1.33B-2.01B321.00M-2.21B4.21B79.00M

Intact Financial Corporation Technical Analysis

Technical Analysis Sentiment
Positive
Last Price311.94
Price Trends
50DMA
298.11
Positive
100DMA
285.98
Positive
200DMA
272.71
Positive
Market Momentum
MACD
4.33
Negative
RSI
61.19
Neutral
STOCH
71.12
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:IFC, the sentiment is Positive. The current price of 311.94 is above the 20-day moving average (MA) of 304.05, above the 50-day MA of 298.11, and above the 200-day MA of 272.71, indicating a bullish trend. The MACD of 4.33 indicates Negative momentum. The RSI at 61.19 is Neutral, neither overbought nor oversold. The STOCH value of 71.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:IFC.

Intact Financial Corporation Peers Comparison

Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TSIFC
76
Outperform
C$55.63B25.1712.95%1.59%4.73%44.14%
64
Neutral
$12.85B9.817.59%16985.65%12.30%-7.71%
SLSLF
$36.90B16.5413.18%3.68%
$40.41B9.1117.21%0.93%
TSIAG
77
Outperform
C$13.23B15.0212.54%2.47%-7.31%28.65%
TSDFY
74
Outperform
C$8.65B20.5113.25%0.90%18.15%18.11%
TSGWO
68
Neutral
C$47.28B12.3614.65%4.43%17.48%25.54%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:IFC
Intact Financial Corporation
311.94
86.35
38.28%
SLF
Sun Life Financial
65.29
17.85
37.63%
FRFHF
Fairfax Financial Holdings
1,662.87
548.69
49.25%
TSE:GWO
Great-West Lifeco
51.34
12.70
32.87%
TSE:IAG
iA Financial Corporation Inc
142.32
56.74
66.30%
TSE:DFY
Definity Financial Corp.
74.30
31.34
72.95%

Intact Financial Corporation Corporate Events

Private Placements and FinancingBusiness Operations and Strategy
Intact Financial Completes $2.9 Billion Note Amendment
Positive
Jun 6, 2025

Intact Financial Corporation announced the successful completion of its consent and proxy solicitation regarding $2.9 billion of medium term notes. The company received the necessary consents to amend the indenture governing these notes, allowing for a proposed amendment to take effect. This move reflects Intact’s strategic financial management and could enhance its operational flexibility, potentially impacting stakeholders positively.

The most recent analyst rating on (TSE:IFC) stock is a Buy with a C$263.00 price target. To see the full list of analyst forecasts on Intact Financial Corporation stock, see the TSE:IFC Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
Intact Financial Seeks Amendments to $2.9 Billion Medium-Term Notes
Neutral
May 14, 2025

Intact Financial Corporation has initiated a consent and proxy solicitation to amend the indenture governing ten series of its Canadian dollar-denominated medium-term notes, totaling $2.9 billion in principal. The company seeks approval from noteholders for a proposed amendment, with a meeting scheduled if the required consent threshold is not met. This move could impact Intact’s financial operations and stakeholder relations, as it involves potential changes to the terms of significant debt instruments.

The most recent analyst rating on (TSE:IFC) stock is a Buy with a C$275.00 price target. To see the full list of analyst forecasts on Intact Financial Corporation stock, see the TSE:IFC Stock Forecast page.

Shareholder MeetingsBusiness Operations and Strategy
Intact Financial Corporation Announces Shareholder Meeting Results
Positive
May 8, 2025

Intact Financial Corporation held its 2025 Annual Meeting of Shareholders virtually, where the election of directors, appointment of Ernst & Young LLP as auditor, and the approach to executive compensation were approved by shareholders. The results indicate strong support for the company’s leadership and strategic direction, which may reinforce its market position and stakeholder confidence.

Financial Disclosures
Intact Financial Corporation Reports Strong Q1-2025 Results
Positive
May 7, 2025

Intact Financial Corporation reported a strong start to 2025, with a 3% growth in operating direct premiums written, driven by momentum in personal lines. The company maintained a stable combined ratio of 91.3% despite increased catastrophe losses, and achieved a 10% increase in net operating income per share to $4.01. The company’s operating return on equity stood at 16.5%, supported by solid underwriting results and increased investment and distribution income. Intact Financial is well-positioned to continue achieving its financial objectives amidst economic uncertainties, with expectations of continued premium growth in both personal and commercial lines.

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.