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 Wednesday, May 22, 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 International Group Inc’s Value Grade

Value Grade:

American International Group, Inc. (AIG) is a global insurance company. The Company provides insurance solutions that help businesses and individuals in approximately 190 countries and jurisdictions protect their assets and manage risks through AIG operations and network partners. The Company operates through three segments: General Insurance, Life and Retirement, and Other Operations. Its General Insurance segment consists of two segments: North America and International. Its Life and Retirement segment consists of four segments: Individual Retirement, Group Retirement, Life Insurance and Institutional Markets. Its North America and International segments consist of two product categories: Commercial Lines, which consists of Liability, Financial Lines, Property and Global Specialty, and Personal Insurance, which consists of Personal Lines, and Accident and Health. Its individual retirement consists of fixed annuities, fixed index annuities and variable annuities.

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 International Group Inc has a Value Score of 89, which is considered to be undervalued.

When you look at American International Group Inc’s price-to-sales ratio at 1.11 compared to the industry median at 1.32, this company has a lower price relative to revenue compared to its peers. This could make American International Group Inc’s stock more attractive for value investors.

American International Group Inc’s price-earnings ratio is 11.74 compared to the industry median at 12.49. This means it has a lower share price relative to earnings compared to its peers. This could make American International Group Inc more attractive for value investors.

Now, let’s assess American International Group Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 5.3, when compared to the industry median of 6.8, 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 International Group Inc’s shareholder yield is higher than its industry median ratio of 2.04%. 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 International Group Inc’s price-to-book ratio is lower than its industry median ratio of 1.37. This could make American International Group Inc more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at American International Group Inc’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. American International Group Inc’s price-to-free-cash-flow ratio is higher than its industry median ratio of 9.75. This could make American International Group Inc less attractive because the higher P/FCF ratio indicates that American International Group Inc is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

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 9.8 compared to the industry median at 12.5. 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 1.37.

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.

Employers Holdings Inc’s Value Grade

Value Grade:

Employers Holdings, Inc. is a holding company. The Company, through its wholly owned insurance subsidiaries, Employers Insurance Company of Nevada (EICN), Employers Compensation Insurance Company (ECIC), Employers Preferred Insurance Company (EPIC), Employers Assurance Company (EAC), and Cerity Insurance Company (CIC), is engaged in the commercial property and casualty insurance industry, specializing in workers compensation products and services, which are focused on small and select businesses engaged in low-to-medium hazard industries. Workers' compensation provides insurance coverage for the statutorily prescribed benefits that employers are required to provide to their employees who may be injured or suffer illness in the course of employment. Its Insurance Operations segment represents the traditional business offered through its agents, including business originated from the Company's strategic partnerships and alliances and direct-to-customer business.

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.

Employers Holdings Inc has a Value Score of 76, which is considered to be undervalued.

Employers Holdings Inc’s price-earnings ratio is 8.8 compared to the industry median at 12.5. This means that it has a lower price relative to its earnings compared to its peers. This makes Employers Holdings Inc more attractive for value investors.

Employers Holdings Inc’s price-to-book ratio is higher than its peers. This could make Employers Holdings Inc less attractive for value investors when compared to the industry median at 1.37.

You can read more about Employers 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.

International General Insuranc Hldgs Ltd’s Value Grade

Value Grade:

International General Insurance Holdings Ltd is a Jordan-based commercial insurance and reinsurance company. It has a worldwide portfolio of energy, property, general aviation, construction and engineering, ports and terminals, marine cargo, marine trades, contingency, political violence, financial institutions, general third-party liability, legal expenses, reinsurance treaty business, among others. Its segments include Specialty Long-tail, Specialty Short-tail and Reinsurance. Its Specialty Long-tail segment includes casualty business, financial institutions line of business, marine liability line of business, and inherent defects insurance line of business. Its Specialty Short-tail segment includes energy, property, construction and engineering, political violence, ports and terminals, marine cargo, contingency and general aviation lines of business. Reinsurance segment includes inward reinsurance treaty business.

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.

International General Insuranc Hldgs Ltd has a Value Score of 91, which is considered to be undervalued.

International General Insuranc Hldgs Ltd’s price-earnings ratio is 5.4 compared to the industry median at 12.5. This means that it has a lower price relative to its earnings compared to its peers. This makes International General Insuranc Hldgs Ltd more attractive for value investors.

International General Insuranc Hldgs Ltd’s price-to-book ratio is higher than its peers. This could make International General Insuranc Hldgs Ltd less attractive for value investors when compared to the industry median at 1.37.

You can read more about International General Insuranc Hldgs Ltd’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.

Loews Corp’s Value Grade

Value Grade:

Loews Corporation is a diversified company with businesses in the insurance, energy, hospitality and packaging industries. Its segments consist of individual operating subsidiaries, including CNA Financial Corporation (CNA), Boardwalk Pipeline Partners, LP and Loews Hotels Holding Corporation (Loews Hotels). The CNA segment provides insurance products, such as commercial property and casualty coverage, and its services also include risk management, information services, warranty and claims administration. The CNA segment's commercial property and casualty insurance operations include Specialty, Commercial and International lines of business. The Boardwalk Pipelines segment is engaged in the business of transportation and storage of natural gas and liquids, and hydrocarbons. Boardwalk Pipelines owns and operates approximately 13,455 miles of interconnected natural gas pipelines directly serving customers in 13 states. Loews Hotels segment is engaged in operating a chain of hotels.

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.

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

Loews Corp’s price-earnings ratio is 11.3 compared to the industry median at 12.5. This means that it has a lower price relative to its earnings compared to its peers. This makes Loews Corp more attractive for value investors.

Loews Corp’s price-to-book ratio is higher than its peers. This could make Loews Corp less attractive for value investors when compared to the industry median at 1.37.

You can read more about Loews 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.

White Mountains Insurance Group Ltd’s Value Grade

Value Grade:

White Mountains Insurance Group, Ltd. is a financial service holding company. The Company is engaged in the acquisition of businesses and assets in the insurance, financial services, and related sectors, operating these businesses and assets through its subsidiaries and disposing of these businesses and assets. The Company’s segments include HG Global/BAM, Ark/WM Outrigger and Kudu. The Company conducts its business primarily in four areas: municipal bond insurance, property and casualty insurance and reinsurance, capital solutions for asset and wealth management firms and other operations. Its municipal bond insurance business is conducted through its subsidiary HG Global Ltd. Its property and casualty insurance and reinsurance business are conducted through its subsidiary Ark Insurance Holdings Limited and its subsidiaries. The Company, through its subsidiary, Kudu Investment Management, LLC, and its subsidiaries, provides capital solutions for asset and wealth management firms.

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.

White Mountains Insurance Group Ltd has a Value Score of 79, which is considered to be undervalued.

White Mountains Insurance Group Ltd’s price-earnings ratio is 8.0 compared to the industry median at 12.5. This means that it has a lower price relative to its earnings compared to its peers. This makes White Mountains Insurance Group Ltd more attractive for value investors.

White Mountains Insurance Group Ltd’s price-to-book ratio is higher than its peers. This could make White Mountains Insurance Group Ltd less attractive for value investors when compared to the industry median at 1.37.

You can read more about White Mountains Insurance Group Ltd’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 International Group Inc stock has a Value Grade of A.
• Cna Financial Corp stock has a Value Grade of A.
• Employers Holdings Inc stock has a Value Grade of B.
• International General Insuranc Hldgs Ltd stock has a Value Grade of A.
• Loews Corp stock has a Value Grade of A.
• White Mountains Insurance Group Ltd stock has a Value Grade of B.

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 Wednesday, May 22
• 4 Undervalued Insurance - Property & Casualty Stocks for Tuesday, May 21
• Why Fidelis Insurance Holdings Ltd’s (FIHL) Stock Is Down 4.76%
• Why Heritage Insurance Holdings Inc’s (HRTG) Stock Is Down 5.25%

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