Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 6 stocks made the list for top value stocks in the Insurance - Property & Casualty industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Insurance - Property & Casualty Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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6 Undervalued Insurance - Property & Casualty Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 6 undervalued stocks in the Insurance - Property & Casualty industry for Tuesday, March 26, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Insurance - Property & Casualty industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

American Coastal Insurance Corp’s Value Grade

Value Grade:

American Coastal Insurance Corporation is the holding company of the insurance carrier, American Coastal Insurance Company. The Company is primarily engaged in the commercial and personal property and casualty insurance business with investments in the United States. Its primary products are commercial and homeowners' residential property insurance. It has two segments: commercial residential property and casualty insurance policies (commercial lines) and personal residential property and casualty insurance policies (personal lines). Its personal lines business provides structure, content and liability coverage for standard single-family homeowners, renters and condominium unit owners, through its subsidiary Interboro Insurance Company. Personal residential products are offered in New York. Its commercial lines business primarily provides commercial multi-peril property insurance for residential condominium associations and apartments in Florida, through its subsidiary AmCoastal.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

American Coastal Insurance Corp has a Value Score of 65, which is considered to be undervalued.

When you look at American Coastal Insurance Corp’s price-to-sales ratio at 1.59 compared to the industry median at 1.27, this company has a higher price relative to revenue compared to its peers. This could make American Coastal Insurance Corp’s stock less attractive for value investors.

American Coastal Insurance Corp’s price-earnings ratio is 5.47 compared to the industry median at 13.62. This means it has a lower share price relative to earnings compared to its peers. This could make American Coastal Insurance Corp more attractive for value investors.

Now, let’s assess American Coastal Insurance Corp’s EV/EBITDA ratio, also known as enterprise multiple. At 2.1, when compared to the industry median of 6.4, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. American Coastal Insurance Corp’s shareholder yield is lower than its industry median ratio of 2.65%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. American Coastal Insurance Corp’s price-to-book ratio is higher than its industry median ratio of 1.28. This could make American Coastal Insurance Corp less attractive to investors looking for a new addition to their portfolio.

Cna Financial Corp’s Value Grade

Value Grade:

CNA Financial Corporation is an insurance holding company. The Company’s segments include Specialty, Commercial and International, and Life & Group and Corporate & Other. The Specialty segment offers management and professional liability and other coverages through property and casualty products and services using a network of brokers, independent agencies and managing general underwriters. The Commercial segment works with a network of brokers and independent agents to market a range of property and casualty insurance products to all types of insureds targeting small business, construction, middle markets and other commercial customers. The International segment underwrites property and casualty coverages on a global basis through a branch operation in Canada, a European business consisting of insurance companies based in the United Kingdom and Luxembourg and Hardy, its Lloyd's syndicate. The Life & Group segment includes the results of its long-term care business that is in run-off.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Cna Financial Corp has a Value Score of 90, which is considered to be undervalued.

Cna Financial Corp’s price-earnings ratio is 10.0 compared to the industry median at 13.6. This means that it has a lower price relative to its earnings compared to its peers. This makes Cna Financial Corp more attractive for value investors.

Cna Financial Corp’s price-to-book ratio is higher than its peers. This could make Cna Financial Corp less attractive for value investors when compared to the industry median at 1.28.

You can read more about Cna Financial Corp’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Conifer Holdings Inc’s Value Grade

Value Grade:

Conifer Holdings, Inc. is an insurance holding company engaged in the sale of property and casualty insurance products. It operates through three classes of insurance businesses: commercial lines, personal lines and wholesale agency business. The commercial insurance offers coverage for both commercial property and commercial liability, including commercial automobiles and workers? compensation. The personal insurance segment offers homeowners insurance and dwelling fire insurance products to individuals in several states. Its specialty homeowners? insurance product is primarily comprised of low-value dwelling insurance tailored for owners of lower valued homes, which offer in Illinois, Indiana and Texas. Wholesale agency business segment offers commercial and personal lines insurance products for its Insurance Company Subsidiaries as well as third-party insurers. Its subsidiaries insurance Red Cedar Insurance Company, White Pine Insurance Company and Sycamore Insurance Agency, Inc.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Conifer Holdings Inc has a Value Score of 65, which is considered to be undervalued.

Conifer Holdings Inc’s price-to-book ratio is higher than its peers. This could make Conifer Holdings Inc less attractive for value investors when compared to the industry median at 1.28.

You can read more about Conifer Holdings Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Investors Title Company’s Value Grade

Value Grade:

Investors Title Company is a holding company. The Company's primary business activity, and one of its segments, is the issuance of residential and commercial title insurance through Investors Title Insurance Company (ITIC) and National Investors Title Insurance Company (NITIC). Its second segment provides tax-deferred real property exchange services through its subsidiaries, Investors Title Exchange Corporation (ITEC) and Investors Title Accommodation Corporation (ITAC). It provides management services to title insurance agencies through its subsidiary, Investors Title Management Services (ITMS), and investment management and trust services to individuals and trusts. Through its two title underwriting subsidiaries, ITIC and NITIC, the Company underwrites title insurance for owners and mortgagees as a primary insurer. ITIC and NITIC offer title insurance coverage to owners and mortgagees of real estate and assume reinsurance of title insurance risks from other title insurance companies.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Investors Title Company has a Value Score of 71, which is considered to be undervalued.

Investors Title Company’s price-earnings ratio is 13.6 compared to the industry median at 13.6. This means that it has a higher price relative to its earnings compared to its peers. This makes Investors Title Company fairly attractive for value investors.

Investors Title Company’s price-to-book ratio is higher than its peers. This could make Investors Title Company less attractive for value investors when compared to the industry median at 1.28.

You can read more about Investors Title Company’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Radian Group Inc’s Value Grade

Value Grade:

Radian Group Inc. is a diversified mortgage and real estate services company. The Company provides mortgage insurance and other products and services to the real estate and mortgage finance industries. The Company operates through its two business segments: Mortgage and homegenius. The Company’s Mortgage segment aggregates, manages and distributes United States mortgage credit risk on behalf of mortgage lending institutions and mortgage credit investors, principally through private mortgage insurance on residential first-lien mortgage loans, and also provides other credit risk management, contract underwriting and fulfillment solutions. The Company's homegenius segment offers an array of title, real estate and technology products and services to consumers, mortgage lenders, mortgage and real estate investors, Government-sponsored enterprises (GSE) and real estate brokers and agents, and corporations for their employees.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Radian Group Inc has a Value Score of 71, which is considered to be undervalued.

Radian Group Inc’s price-earnings ratio is 8.7 compared to the industry median at 13.6. This means that it has a lower price relative to its earnings compared to its peers. This makes Radian Group Inc more attractive for value investors.

Radian Group Inc’s price-to-book ratio is higher than its peers. This could make Radian Group Inc less attractive for value investors when compared to the industry median at 1.28.

You can read more about Radian Group Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

United Fire Group Inc’s Value Grade

Value Grade:

United Fire Group, Inc. is engaged in the business of writing property and casualty insurance through a network of independent agencies. The Company’s insurance company subsidiaries are licensed as property and casualty insurers in 50 states, plus the District of Columbia. Its business is comprised primarily of commercial lines property and casualty insurance, including surety bonds. Its core commercial products support a variety of customers, including small business owners and middle market businesses operating in industries, such as construction, services, retail trade, financial and manufacturing, along with contract surety and commercial surety bonds offered through approximately 1,000 independent property and casualty agencies. It also provides specialty and surplus lines coverage through wholesale brokers on an admitted and non-admitted basis. Additionally, it offers reinsurance coverage for property and casualty insurance through traditional treaty reinsurance channels.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

United Fire Group Inc has a Value Score of 98, which is considered to be undervalued.

United Fire Group Inc’s price-to-book ratio is higher than its peers. This could make United Fire Group Inc less attractive for value investors when compared to the industry median at 1.28.

You can read more about United Fire Group Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Insurance - Property & Casualty Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Insurance - Property & Casualty stocks as well as other industrys.

Choosing Which of the 6 Best Insurance - Property & Casualty Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• American Coastal Insurance Corp stock has a Value Grade of B.
• Cna Financial Corp stock has a Value Grade of A.
• Conifer Holdings Inc stock has a Value Grade of B.
• Investors Title Company stock has a Value Grade of B.
• Radian Group Inc stock has a Value Grade of B.
• United Fire Group Inc stock has a Value Grade of A.

Now that you have a bit more background about each of the 6 undervalued stocks in the Insurance - Property & Casualty industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Insurance - Property & Casualty Stocks

Want to learn more about Insurance - Property & Casualty stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 6 Undervalued Insurance - Property & Casualty Stocks for Tuesday, March 26
• 5 Undervalued Insurance - Property & Casualty Stocks for Monday, March 25
• 4 Undervalued Insurance - Property & Casualty Stocks for Friday, March 22
• Why American Coastal Insurance Corp’s (ACIC) Stock Is Down 6.91%

AAII Disclaimer

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