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Unum Group (UNM)
NYSE:UNM
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Unum Group
(NYSE:UNM)
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Rating:71Outperform
Price Target:
$87.00
▲(11.32% Upside)
Unum Group's overall stock score is driven by strong financial performance and robust cash flow generation. The earnings call provided mixed signals with strong premium growth but challenges in the Closed Block impacting earnings. Technical indicators suggest stability, while valuation metrics indicate the stock is fairly valued.
Positive Factors
Premium Growth
Sustained premium growth across segments indicates strong market demand and effective sales strategies, supporting long-term revenue expansion.
Capital Position
A robust capital position provides financial flexibility for strategic investments and shareholder returns, enhancing long-term stability and growth potential.
Cash Flow Generation
Strong cash flow generation ensures liquidity and supports ongoing operations, debt servicing, and potential reinvestment in growth opportunities.
Negative Factors
Operational Efficiency
Challenges in operational efficiency could hinder profitability and competitive positioning, necessitating strategic improvements to sustain margins.
Reserve Increases
Significant reserve increases can strain financial resources and reflect underlying risk management challenges, impacting future earnings stability.
Closed Block Volatility
Volatility in the Closed Block introduces earnings uncertainty, potentially affecting investor confidence and long-term financial planning.
Unum Group (UNM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$12.85B
Dividend Yield2.25%
Average Volume (3M)1.27M
Price to Earnings (P/E)15.0
Beta (1Y)0.63
Revenue Growth1.80%
EPS Growth-44.44%
CountryUS
Employees10,833
SectorFinancial
Sector Strength70
IndustryInsurance - Life
Share Statistics
EPS (TTM)2.09
Shares Outstanding167,331,270
10 Day Avg. Volume1,894,451
30 Day Avg. Volume1,274,735
Financial Highlights & Ratios
PEG Ratio0.17
Price to Book (P/B)1.24
Price to Sales (P/S)1.06
P/FCF Ratio9.81
Enterprise Value/Market Cap1.32
Enterprise Value/Revenue1.30
Enterprise Value/Gross Profit1.76
Enterprise Value/Ebitda12.61
Forecast
1Y Price Target
$91.75Price Target Upside17.40% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Unum Group Business Overview & Revenue Model
Company DescriptionUnum Group (UNM) is a leading provider of financial protection benefits in the United States and the United Kingdom. The company operates primarily in the insurance sector, offering a range of products including disability insurance, life insurance, and supplemental health insurance. Unum's core services are designed to provide income protection for employees and their families during times of need, ensuring financial stability through various life events such as illness, injury, or death.
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:Sep 30, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 03, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted strong premium growth, a successful LTC reinsurance transaction, and a robust capital position. However, challenges included earnings per share falling below expectations and significant reserve increases in the Closed Block, driven by changes in morbidity and mortality assumptions.Q3-2025 Updates
Positive Updates
Solid Premium Growth
Year-to-date solid premium growth was up 4%, with Unum US growing nearly 4%, Colonial Life up over 3%, and International delivering 10% growth. This reflects a strong market position and high levels of persistency.
Successful LTC Reinsurance Transaction
Unum completed a milestone long-term care reinsurance transaction with Fortitude Re, which ceded 20% of LTC reserves, showcasing the company's ability to execute in the market.
Robust Capital Position
The company maintained a holding company liquidity of $2 billion and an RBC ratio of over 450%, both well above targets, providing flexibility to pursue strategic actions and return capital to shareholders.
Strong Shareholder Returns
Through the first 9 months of 2025, nearly $1 billion was returned to shareholders, including $750 million in share repurchases and $230 million in dividends.
Negative Updates
Earnings Per Share Below Expectations
Earnings per share of $2.09 fell below expectations, primarily due to volatility in the Closed Block.
Closed Block Reserve Increase
The reserve assumption review led to a net increase in reserves of $478.5 million pretax, with a significant portion attributable to long-term care.
Impact of Morbidity and Mortality Assumptions
The removal of morbidity and mortality improvement assumptions added $850 million to reserves, creating modeling uncertainty.
Company Guidance
During the Unum Group's 3Q 2025 earnings call, the company provided various metrics reflecting its financial performance and strategic directions. Year-to-date premium growth was reported at 4%, contributing to industry-leading margins and robust capital generation. Despite earnings per share of $2.09 falling short of expectations due to volatility in the Closed Block, core businesses exceeded projections with a return on equity for core operations near 20%, and an aggregate return on equity of 11.3%. Premium growth was robust across segments, with Unum US up nearly 4%, Colonial Life over 3%, and International at 10%. The company completed a long-term care reinsurance transaction, ceding 20% of LTC reserves, and announced a series of strategic actions to manage the Closed Block, including a reserve increase of $378 million after-tax. Additionally, Unum returned nearly $1 billion to shareholders through $750 million in share repurchases and $230 million in dividends, maintaining a strong capital position with an RBC ratio exceeding 450% and holding company liquidity of $2 billion.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 | 13.05B | 12.89B | 12.39B | 11.99B | 12.01B | 13.16B |
| Gross Profit | 9.69B | 12.89B | 12.39B | 11.52B | 11.80B | 13.16B |
| EBITDA | 1.35B | 2.57B | 1.94B | 2.05B | 1.57B | 1.27B |
| Net Income | 913.10M | 1.78B | 1.28B | 1.41B | 981.00M | 793.00M |
Balance Sheet | ||||||
| Total Assets | 0.00 | 61.96B | 63.26B | 61.43B | 70.12B | 70.63B |
| Cash, Cash Equivalents and Short-Term Investments | 0.00 | 1.40B | 146.00M | 1.51B | 1.46B | 1.67B |
| Total Debt | 3.75B | 3.74B | 3.43B | 3.43B | 3.44B | 3.35B |
| Total Liabilities | 52.77B | 51.00B | 53.60B | 52.24B | 58.70B | 59.75B |
| Stockholders Equity | 10.91B | 10.96B | 9.65B | 9.20B | 11.42B | 10.87B |
Cash Flow | ||||||
| Free Cash Flow | 689.10M | 1.39B | 1.07B | 1.32B | 1.28B | 478.40M |
| Operating Cash Flow | 815.60M | 1.51B | 1.20B | 1.42B | 1.39B | 597.50M |
| Investing Cash Flow | 820.10M | -344.40M | -725.90M | -955.90M | -1.34B | -267.70M |
| Financing Cash Flow | -1.47B | -1.15B | -450.10M | -418.60M | -168.90M | -216.90M |
Unum Group Technical Analysis
Positive
78.15
Price Trends
75.34
Positive
75.18
Positive
76.27
Positive
Market Momentum
0.31
Negative
59.58
Neutral
74.09
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 78.15 is above the 20-day moving average (MA) of 75.45, above the 50-day MA of 75.34, and above the 200-day MA of 76.27, indicating a bullish trend. The MACD of 0.31 indicates Negative momentum. The RSI at 59.58 is Neutral, neither overbought nor oversold. The STOCH value of 74.09 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
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $4.03B | 12.22 | 10.12% | 2.86% | -4.56% | ― | |
71 Outperform | $12.85B | 14.96 | 8.35% | 2.25% | 1.80% | -44.44% | |
71 Outperform | $10.49B | 9.55 | 22.28% | 0.79% | 3.73% | 17.47% | |
68 Neutral | $7.76B | 3.67 | 21.66% | 4.37% | 35.76% | 636.97% | |
68 Neutral | $8.11B | 11.49 | 33.91% | 1.54% | 5.63% | 67.39% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
63 Neutral | $6.26B | 12.74 | 5.50% | 3.36% | 24.94% | ― |
* Financial Sector Average
UNM
Unum Group
78.15
9.51
13.85%
LNC
Lincoln National
41.15
7.06
20.71%
PRI
Primerica
252.63
-43.65
-14.73%
GL
Globe Life
132.24
24.12
22.31%
JXN
Jackson Financial Incorporation
92.88
-16.54
-15.12%
FG
F&G Annuities & Life Inc
30.81
-15.29
-33.17%
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.