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Unum Group (UNM)
NYSE:UNM
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Unum Group
(NYSE:UNM)
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Rating:73Outperform
Price Target:
$84.00
▲(9.33% Upside)
Unum Group's overall stock score reflects strong financial performance and attractive valuation, which are the most significant factors. The company's robust revenue growth, stable balance sheet, and efficient cash flow management contribute positively. However, technical analysis indicates potential short-term overbought conditions, and the earnings call highlights some operational challenges and earnings pressures. Despite these challenges, the company's strategic initiatives and strong capital position provide a solid foundation for future growth.
Positive Factors
Strong Capital Position
A high risk-based capital ratio and substantial liquidity indicate strong financial health, providing a buffer against economic downturns and enabling strategic investments.
Revenue Growth
Consistent premium growth and high persistency levels reflect a stable customer base and effective retention strategies, supporting long-term revenue expansion.
Strategic Acquisitions
Strategic acquisitions and partnerships enhance market position and digital capabilities, driving growth and competitive advantage in key markets.
Negative Factors
Earnings Pressure
Declining earnings per share due to higher claims can strain profitability and indicate challenges in managing cost structures, impacting long-term financial performance.
Elevated Claims
Elevated claims in group products suggest potential issues in underwriting or risk assessment, which could lead to sustained pressure on margins if not addressed.
Challenging Sales Environment
A challenging sales environment with slower-than-expected growth may hinder revenue expansion and require strategic adjustments to meet market demands.
Unum Group (UNM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$12.93B
Dividend Yield2.24%
Average Volume (3M)1.48M
Price to Earnings (P/E)9.1
Beta (1Y)0.48
Revenue Growth1.69%
EPS Growth22.65%
CountryUS
Employees10,833
SectorFinancial
Sector Strength70
IndustryInsurance - Life
Share Statistics
EPS (TTM)2.07
Shares Outstanding170,313,230
10 Day Avg. Volume1,687,899
30 Day Avg. Volume1,477,418
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.38
Enterprise Value/Revenue1.38
Enterprise Value/Gross Profit1.64
Enterprise Value/Ebitda8.06
Forecast
1Y Price Target
$91.90Price Target Upside19.61% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
Unum Group Business Overview & Revenue Model
Company DescriptionUnum Group, together with its subsidiaries, provides financial protection benefit solutions primarily in the United States, the United Kingdom, and Poland. It operates through Unum US, Unum International, Colonial Life, and Closed Block segments. The company offers group long-term and short-term disability, group life, and accidental death and dismemberment products; supplemental and voluntary products, such as individual disability, voluntary benefits, and dental and vision products; and accident, sickness, disability, life, and cancer and critical illness products. It also provides group pension, individual life and corporate-owned life insurance, reinsurance pools and management operations, and other products. The company sells its products primarily to employers for the benefit of employees. Unum Group sells its products through field sales personnel, independent brokers, consultants, and independent contractor agency sales force. The company was founded in 1848 and is based in Chattanooga, Tennessee.
How the Company Makes MoneyUnum Group generates revenue primarily through the sale of insurance premiums from its various products, including group and individual disability insurance, life insurance, and other supplemental insurance offerings. The company collects premiums from policyholders, which constitute a significant portion of its income. Additionally, Unum earns investment income from its portfolio of invested assets, which includes stocks, bonds, and other financial instruments. The company also benefits from strategic partnerships with employers, enabling it to offer its products as part of employee benefits packages, thereby expanding its customer base. Furthermore, effective risk management practices and underwriting processes help maintain profitability by controlling claims costs.
Unum Group Earnings Call Summary
Earnings Call Date:Jul 29, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 04, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture, with strong capital levels and strategic transactions supporting long-term growth, but current earnings were pressured by elevated claims and challenges in the sales environment. While Unum's capital position and strategic initiatives are strong, short-term operational challenges and lower-than-expected earnings suggest a balanced outlook.Q2-2025 Updates
Positive Updates
Strong Persistency and Premium Growth
Unum reported strong premium growth of 4.6% in the quarter, driven by high persistency levels and natural growth within the in-force block, which mitigated the impact of pressured sales.
Record High Capital Levels
The company's risk-based capital ratio increased to approximately 485%, one of the highest levels seen, with holding company liquidity at $2 billion, indicating strong financial health.
Successful Strategic Transactions
Unum completed the acquisition of a small block of group business in the U.K. and became the exclusive U.K. Employee Benefits partner for Generali Employee Benefits Network. Additionally, they acquired Beanstalk Benefits to enhance their digital platform.
Increased Capital Returns to Shareholders
Unum announced a 10% increase in its annual common stock dividend and repurchased $300 million in shares during the second quarter, with total capital returns for the year reaching $650 million.
Closure of External Reinsurance Transaction
The closure of the external reinsurance transaction is expected to enhance Unum's focus on their core employee benefits business while reducing exposure to Legacy Long-Term Care.
Negative Updates
Disappointing Earnings Performance
Second quarter adjusted after-tax operating income per share was $2.07, down from $2.16 in the same period last year, reflecting earnings pressure due to higher-than-expected claims experience.
Elevated Claims in Group Products
Higher-than-expected claims experience in group products, particularly group disability, with a benefit ratio of 62% compared to historical expectations.
Challenging Sales Environment
Sales in the first half of 2025 started slower than annual growth expectations and were lower year-over-year, with total group sales expected to be relatively flat for the full year.
Unfavorable Long-Term Care Experience
The Closed Block segment experienced unfavorable Long-Term Care benefits experience, primarily in capped cohorts, leading to a significant decrease in adjusted operating income.
Lower-than-Expected Alternative Investment Income
The alternative investment portfolio yielded 7%, below the long-term expectation of 8% to 10%, impacting the earnings performance of the Closed Block segment.
Company Guidance
In the Unum Group's Second Quarter 2025 Earnings Call, the company provided updated guidance and metrics reflecting its financial performance and strategic initiatives. The company reported a 4.6% core operations premium growth for the quarter and revised its full-year earnings per share (EPS) expectation to approximately $8.50. This adjustment was attributed to pressures in earnings, particularly within the group disability segment, which recorded a benefit ratio of 62%, slightly higher than anticipated. The company highlighted a strong capital position, ending the quarter with $2 billion in holding company cash and a 485% risk-based capital ratio. Despite a slower start to sales in the first half, Unum Group remains optimistic about achieving its premium growth outlook of 3% to 6% for the year, bolstered by higher-than-expected persistency levels and strategic investments in digital capabilities. The company also announced a 10% increase in its annual common stock dividend and repurchased $300 million in shares during the quarter, aiming to finish the year toward the upper end of its $500 million to $1 billion range of share repurchases.Unum Group Financial Statement Overview
Summary
Unum Group exhibits strong financial performance with impressive revenue growth and profitability. The balance sheet is stable with moderate leverage, and cash flow generation is robust. However, operational efficiency as indicated by the negative EBIT margin in the TTM period needs attention.Income Statement
Unum Group has demonstrated strong revenue growth with a TTM increase of 99.8%, indicating robust business expansion. The gross profit margin is high at 84.23% for TTM, showcasing effective cost management. However, the EBIT margin is negative in the TTM period, reflecting operational challenges. Net profit margin remains healthy at 11.80% for TTM, but slightly lower than the previous annual report. Overall, the income statement reflects strong revenue growth and profitability, though operational efficiency needs improvement.75
Positive
Balance Sheet
The company maintains a moderate debt-to-equity ratio of 0.33 in the TTM period, indicating a balanced approach to leverage. Return on equity is solid at 13.67% for TTM, reflecting effective use of shareholder funds. The equity ratio stands at 18.01%, suggesting a stable capital structure. While the balance sheet shows financial stability, the equity ratio indicates potential room for strengthening equity base.70
Positive
Cash Flow
Unum Group's cash flow performance is strong, with a significant free cash flow growth rate of 60.6% in the TTM period. The operating cash flow to net income ratio is robust at 2.94, indicating efficient cash generation relative to earnings. The free cash flow to net income ratio is high at 91.54%, demonstrating effective conversion of profits into cash. Overall, the cash flow statement reflects strong liquidity and cash management.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 12.88B | 12.89B | 12.39B | 11.99B | 12.01B | 13.16B |
| Gross Profit | 10.85B | 12.89B | 12.39B | 11.52B | 11.80B | 13.16B |
| EBITDA | 2.21B | 2.45B | 1.94B | 2.05B | 1.57B | 1.27B |
| Net Income | 1.52B | 1.78B | 1.28B | 1.41B | 981.00M | 793.00M |
Balance Sheet | ||||||
| Total Assets | 62.84B | 61.96B | 63.26B | 61.43B | 70.12B | 70.63B |
| Cash, Cash Equivalents and Short-Term Investments | 39.45B | 1.40B | 146.00M | 1.51B | 1.46B | 1.67B |
| Total Debt | 3.74B | 3.74B | 3.43B | 3.43B | 3.44B | 3.35B |
| Total Liabilities | 51.52B | 51.00B | 53.60B | 52.24B | 58.70B | 59.75B |
| Stockholders Equity | 11.32B | 10.96B | 9.65B | 9.20B | 11.42B | 10.87B |
Cash Flow | ||||||
| Free Cash Flow | 1.44B | 1.39B | 1.07B | 1.32B | 1.28B | 478.40M |
| Operating Cash Flow | 1.58B | 1.51B | 1.20B | 1.42B | 1.39B | 597.50M |
| Investing Cash Flow | 889.70M | -344.40M | -725.90M | -955.90M | -1.34B | -267.70M |
| Financing Cash Flow | -1.41B | -1.15B | -450.10M | -418.60M | -168.90M | -216.90M |
Unum Group Technical Analysis
Positive
76.83
Price Trends
73.49
Positive
76.67
Positive
76.02
Positive
Market Momentum
1.17
Negative
67.05
Neutral
78.18
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UNM, the sentiment is Positive. The current price of 76.83 is above the 20-day moving average (MA) of 73.78, above the 50-day MA of 73.49, and above the 200-day MA of 76.02, indicating a bullish trend. The MACD of 1.17 indicates Negative momentum. The RSI at 67.05 is Neutral, neither overbought nor oversold. The STOCH value of 78.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UNM.
Unum Group Risk Analysis
Unum Group disclosed 30 risk factors in its most recent earnings report. Unum 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
Unum Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | 4.35B | 13.41 | 16.17% | 2.72% | 1.78% | 0.77% | |
77 Outperform | 11.61B | 11.71 | 19.66% | 0.71% | 4.02% | 13.01% | |
74 Outperform | 8.86B | 14.14 | 29.42% | 1.47% | 5.70% | 61.69% | |
73 Outperform | $12.93B | 9.08 | 13.95% | 2.24% | 1.69% | 22.65% | |
71 Outperform | 7.73B | 7.08 | 39.61% | 4.42% | 11.33% | -38.17% | |
63 Neutral | 7.12B | -1,607.55 | ― | 3.03% | 27.18% | -100.02% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
Performance Comparison
UNM
Unum Group
76.83
20.05
35.31%
LNC
Lincoln National
40.76
11.05
37.19%
PRI
Primerica
273.51
10.76
4.10%
GL
Globe Life
143.30
34.65
31.89%
JXN
Jackson Financial Incorporation
102.24
15.01
17.21%
FG
F&G Annuities & Life Inc
32.32
-9.78
-23.23%
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.