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United Fire Group (UFCS)
:UFCS
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United Fire Group
(NASDAQ:UFCS)
Select Model
Select Model
Rating:71Outperform
Price Target:
$38.00
▲(2.21% Upside)
United Fire Group's strong financial performance and robust earnings call guidance are the primary drivers of its stock score. The company's attractive valuation and consistent dividend payments further enhance its appeal. However, technical indicators suggest caution due to potential oversold conditions.
Positive Factors
Revenue Growth
The strong growth in net written premiums, especially in core commercial business, indicates robust demand and effective market penetration, supporting long-term revenue expansion.
Profitability Improvements
The significant increase in net income reflects enhanced operational efficiency and effective cost management, contributing to sustained profitability.
Investment Income Growth
The increase in investment income strengthens financial stability and provides additional resources for growth and shareholder returns.
Negative Factors
Soft Market Conditions
Soft market conditions can lead to pricing pressures and reduced margins, challenging the company's ability to maintain profitability.
Decline in Specialty Premiums
A decline in specialty premiums could indicate challenges in maintaining competitive advantage in niche markets, affecting revenue diversity.
Decreased Operating Cash Flow
Reduced operating cash flow may impact liquidity and limit the company's ability to invest in growth opportunities or weather economic downturns.
United Fire Group (UFCS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$931.27M
Dividend Yield1.74%
Average Volume (3M)123.61K
Price to Earnings (P/E)8.6
Beta (1Y)0.53
Revenue Growth12.22%
EPS Growth120.73%
CountryUS
Employees877
SectorFinancial
Sector Strength70
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)1.50
Shares Outstanding25,514,330
10 Day Avg. Volume108,820
30 Day Avg. Volume123,606
Financial Highlights & Ratios
PEG Ratio-0.04
Price to Book (P/B)0.92
Price to Sales (P/S)0.58
P/FCF Ratio2.19
Enterprise Value/Market Cap1.02
Enterprise Value/Revenue0.70
Enterprise Value/Gross Profit3.21
Enterprise Value/Ebitda5.92
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)3.66
Revenue Forecast (FY)$1.29B
United Fire Group Business Overview & Revenue Model
Company DescriptionUnited Fire Group (UFCS) is a publicly traded holding company that operates in the insurance sector, primarily focusing on property and casualty insurance. Founded in 1946 and headquartered in Cedar Rapids, Iowa, UFCS provides a range of insurance products including personal, commercial, and life insurance. The company is structured into segments that cater to various market needs, ensuring comprehensive coverage for individuals and businesses alike.
How the Company Makes MoneyUnited Fire Group generates revenue primarily through the underwriting of insurance premiums. The company collects premiums from policyholders in exchange for providing insurance coverage. This revenue is supplemented by investment income derived from the company's investment portfolio, which includes fixed-income securities, equities, and other financial instruments. Key revenue streams include personal lines, commercial lines, and life insurance products. Additionally, UFCS benefits from strategic partnerships with agents and brokers who help distribute its insurance products, enhancing market reach and customer acquisition. The successful management of claims and underwriting risk also plays a crucial role in maintaining profitability, as effective loss control can lead to lower claim payouts and higher overall earnings.
United Fire Group Earnings Call Summary
Earnings Call Date:Nov 04, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 17, 2026
Earnings Call Sentiment Positive
The earnings call reflected a strong financial performance with record net income and combined ratio improvements, alongside significant growth in key business areas. However, challenges were noted due to soft market conditions and a slight decline in specific premium lines.Q3-2025 Updates
Positive Updates
Record Net Income and Combined Ratio
Third quarter net income increased to $39.2 million, nearly doubling from the prior year, marking the highest net income in at least 20 years. Achieved a 91.9% combined ratio, the best third quarter underwriting result in nearly two decades.
Strong Return on Equity
Achieved a return on equity of 12.7% through the first nine months of 2025, the company's best year-to-date financial performance in nearly 20 years.
Exceptional Loss Ratio Improvement
Underlying loss ratio improved by 1.9 points to 56% in the third quarter and by 2 points to 56.7% year-to-date compared to the same periods last year.
Net Written Premium Growth
Net written premium grew by 7% in the quarter, with core commercial business growing by 22%.
Increased Investment Income
The fixed income portfolio generated 17% more income compared to the prior year, with new purchase yields exceeding the overall portfolio yield by 60 basis points.
Improved Expense Ratio
The third quarter expense ratio of 34.6% improved by 1.3 points from the prior year.
Negative Updates
Soft Market Conditions
Entering a soft market with competitive pressure in the E&S market, particularly as casualty pricing remains robust while property rates continue to moderate.
Slight Decline in Specialty Excess and Surplus Lines Premiums
Specialty excess and surplus lines premiums were slightly down compared to the prior year after strong growth in the first half of the year.
Company Guidance
During the UFG Insurance Third Quarter 2025 Financial Results Conference Call, the company provided robust guidance, highlighting significant achievements and strategic directions. UFG reported a net income of $39.2 million for the third quarter, marking nearly double the previous year's figure and achieving a 91.9% combined ratio, the best third-quarter underwriting result in nearly 20 years. The net written premium reached a record $328 million, while the return on equity for the first nine months of 2025 was 12.7%, the highest in nearly two decades. The company emphasized improvements in underwriting, with the underlying loss ratio improving by 1.9 points to 56%. Catastrophe loss ratio was well below expectations at 1.3%. Furthermore, net investment income increased by 17% year-over-year. The expense ratio improved by 1.3 points to 34.6%. UFG also noted a strategic focus on delivering consistent profitability, diversifying growth, and enhancing relevance with distribution partners to navigate the moderating market dynamics.United Fire Group Financial Statement Overview
Summary
United Fire Group demonstrates a solid financial position with improving profitability and efficient cash flow management. The company has shown resilience with revenue and profit growth, despite some challenges in gross profit margins and operating cash flow. The low leverage and strong return on equity further enhance its financial stability, positioning it well within the insurance industry.Income Statement
United Fire Group has shown a positive revenue growth rate of 2.27% in the TTM, indicating a recovery from previous periods. The net profit margin improved to 8.23%, reflecting enhanced profitability. However, the gross profit margin decreased significantly from 18.05% in 2024 to 5.80% in the TTM, which could indicate rising costs or pricing pressures. The EBIT and EBITDA margins have improved, suggesting better operational efficiency.72
Positive
Balance Sheet
The company maintains a low debt-to-equity ratio, indicating conservative leverage, which is favorable for stability. The return on equity improved to 13.31% in the TTM, showing effective use of equity to generate profits. However, the equity ratio has not been explicitly provided, which limits a complete assessment of asset financing.65
Positive
Cash Flow
Free cash flow growth is positive at 2.03% in the TTM, indicating improved cash generation. The free cash flow to net income ratio remains strong at 96.60%, suggesting efficient conversion of profits into cash. However, the operating cash flow has decreased compared to previous periods, which could impact liquidity if not addressed.68
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.35B | 1.25B | 1.10B | 988.22M | 1.06B | 1.08B |
| Gross Profit | 295.24M | 225.92M | 83.93M | 137.84M | 200.91M | -1.46M |
| EBITDA | 160.24M | 95.22M | -25.95M | 22.93M | 106.60M | -162.86M |
| Net Income | 111.28M | 61.96M | -29.70M | 15.03M | 80.59M | -112.71M |
Balance Sheet | ||||||
| Total Assets | 3.75B | 3.49B | 3.14B | 2.88B | 3.01B | 3.07B |
| Cash, Cash Equivalents and Short-Term Investments | 1.24B | 1.13B | 102.15M | 96.92M | 132.38M | 88.12M |
| Total Debt | 146.13M | 117.06M | 50.00M | 50.00M | 50.00M | 50.00M |
| Total Liabilities | 2.86B | 2.71B | 2.41B | 2.14B | 2.13B | 2.24B |
| Stockholders Equity | 898.71M | 781.53M | 733.75M | 740.11M | 879.12M | 825.15M |
Cash Flow | ||||||
| Free Cash Flow | 297.53M | 328.43M | 160.85M | -3.39M | 15.94M | 22.57M |
| Operating Cash Flow | 306.26M | 340.30M | 171.74M | -1.25M | 29.92M | 41.44M |
| Investing Cash Flow | -282.98M | -292.49M | -149.89M | -19.17M | 31.73M | -92.87M |
| Financing Cash Flow | 13.09M | 51.09M | -16.45M | -15.03M | -17.49M | 18.66M |
United Fire Group Technical Analysis
Positive
37.18
Price Trends
33.59
Positive
31.73
Positive
29.70
Positive
Market Momentum
0.55
Positive
62.03
Neutral
72.20
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UFCS, the sentiment is Positive. The current price of 37.18 is above the 20-day moving average (MA) of 36.18, above the 50-day MA of 33.59, and above the 200-day MA of 29.70, indicating a bullish trend. The MACD of 0.55 indicates Positive momentum. The RSI at 62.03 is Neutral, neither overbought nor oversold. The STOCH value of 72.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UFCS.
United Fire Group Risk Analysis
United Fire Group disclosed 20 risk factors in its most recent earnings report. United Fire Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
United Fire Group Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $1.14B | 13.04 | 9.97% | 4.64% | 13.35% | 16.56% | |
73 Outperform | $590.06M | 6.98 | 29.35% | ― | 16.34% | -1.26% | |
72 Outperform | $848.52M | 5.97 | 41.64% | ― | 5.92% | 93.02% | |
71 Outperform | $931.27M | 8.61 | 13.21% | 1.74% | 12.22% | 120.73% | |
69 Neutral | $918.88M | 7.73 | 27.34% | 2.31% | 4.61% | 73.40% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
62 Neutral | $715.83M | 8.28 | 15.10% | 3.54% | 0.93% | 224.95% |
* Financial Sector Average
UFCS
United Fire Group
36.76
6.12
19.97%
DGICA
Donegal Group
20.36
4.65
29.60%
SAFT
Safety Insurance Group
78.53
-1.23
-1.54%
UVE
Universal Insurance Holdings
33.02
12.51
60.99%
ACIC
American Coastal Insurance
12.67
-0.80
-5.94%
HRTG
Heritage Insurance Holdings
29.08
16.60
133.01%
United Fire Group Corporate Events
Dividends
United Fire Group Declares Quarterly Dividend
Positive
Nov 21, 2025
On November 21, 2025, United Fire Group, Inc. declared a quarterly cash dividend of $0.16 per share, payable on December 19, 2025, to shareholders of record as of December 5, 2025. This marks the 231st consecutive quarterly dividend paid by the company, highlighting its long-standing commitment to returning value to shareholders since March 1968.
Financial Disclosures
United Fire Group to Release Q3 2025 Earnings
Neutral
Oct 23, 2025
United Fire Group, Inc. announced that it will release its third quarter 2025 earnings after the market closes on November 4, 2025, with an earnings call scheduled for November 5, 2025. This announcement provides stakeholders the opportunity to hear management discuss the company’s financial performance, potentially impacting investor decisions and market perceptions.
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.