Fundamentals snapshot
UFCS · NMS · Financial Services · Insurance - Property & Casualty
Current price
$55.38
52-week range
$29.74 - $56.74
Market cap
$1.42B
One-glance verdict
We don't put a cash-flow fair value on banks and insurers. For these companies the reported 'cash flow' is really just money moving between loans, deposits and trades — not the leftover profit the owners could actually pocket — so the usual method would print a misleading number.
Balance sheet
Net debt $6.91M. Interest coverage shows how many times profit covers the interest bill.
What stands out
What this company does
United Fire Group sells insurance policies that protect small and mid-sized businesses from financial losses due to events like property damage or employee accidents. The company makes money by collecting regular payments from its customers (called premiums) and aims to earn more from these premiums than it pays out to cover claims. This difference between money collected and money paid out shows how well the company is at pricing its policies to manage risk.
United Fire Group started in 1946 in a small house in Cedar Rapids, Iowa, founded by Scott McIntyre Sr. Initially called United Casualty Company, it sold auto and liability insurance just in Iowa. Over the decades, it grew by merging with other small insurance companies, expanding across the country, and adding new types of insurance like fire protection and surety bonds (a type of guarantee that a company will fulfill its obligations). The company has focused on selling its products through independent insurance agents rather than directly to consumers. In recent years, it has concentrated on improving its profitability by being more selective about the risks it insures.
United Fire Group is a property and casualty insurance company. Think of it as a business that sells financial protection to other businesses. If a company's building is damaged in a storm (property insurance) or if someone gets hurt on their premises (casualty, or liability, insurance), UFCS pays for the covered costs. It sells these insurance policies through a network of about 850 independent agents who are not direct employees. Their main customers are small to mid-sized businesses in industries like construction, retail, and manufacturing.
This is the company's main business, focused on providing insurance to other businesses. This includes coverage for things like commercial buildings and property, liability (in case the business is sued), company vehicles, and workers' compensation (which covers employees who get injured on the job). This segment is the core of UFCS's operations and serves a wide range of industries, from contractors to retailers. They sell these policies through independent agents who work with various businesses to find the right coverage.
This part of the business provides a specific type of financial guarantee. A surety bond is a promise by the insurance company to pay a certain amount if a company fails to meet an obligation. For example, a construction company might need a surety bond to guarantee it will finish a building project as promised. This is a smaller but important part of their commercial business, helping to ensure that contracts and other business obligations are fulfilled.
This segment handles more unique or difficult-to-place risks that the standard insurance market might not cover. Think of it as insurance for unusual situations, such as coverage for marine-related activities, professional liability for certain occupations, or earthquake protection. This business is often conducted through wholesale brokers who specialize in finding coverage for these tougher accounts. It represents a more specialized and growing area for the company.
In this business line, United Fire Group essentially insures other insurance companies. Reinsurance is a way for insurers to spread out their risks, especially for very large potential losses like those from a major hurricane. UFCS participates in this market by taking on a portion of the risk from other insurers in exchange for a part of the premium (the fee paid for the insurance policy). This helps to diversify the company's own risk portfolio.
The company's current strategy is heavily focused on improving underwriting profitability, which means carefully selecting the risks it insures to make sure the premiums collected will cover potential claims and costs. Instead of just trying to sell more policies, they are concentrating on writing better, more profitable business. Management is also working on strengthening relationships with their independent agents and managing their exposure to large disasters, like weather events. The goal is to achieve more consistent and superior financial performance over the long term.
Price history
Earnings history
Click any quarter to read the call summary and what the numbers say.
Is it cheap or expensive?
For a bank or insurer, the "free cash flow" shown on its statements is mostly money flowing through loans, deposits and trades — not the leftover profit the owners could actually keep, which is what this kind of valuation needs. Running that through the usual method would spit out a meaningless number, so we leave the cash-flow fair value out here rather than show you something misleading.
Is it drowning in debt?
Net debt $6.9M. Interest coverage 14.1x.
United Fire Group, Inc.'s profit covers its interest bill about 14.1 times over.
Total debt $146.35M Interest coverage 14.13x This is the baseline the peer rows are being compared against.
Total debt $59.77M Interest coverage 83.80x +493% vs UFCS Carries about 5.9x more debt cushion than UFCS.
Total debt $1.78M Interest coverage 71.63x +407% vs UFCS Carries about 5.1x more debt cushion than UFCS.
Total debt $97.85M Interest coverage 43.54x +208% vs UFCS Carries about 3.1x more debt cushion than UFCS.
Total debt $148.87M Interest coverage 34.45x +144% vs UFCS Carries about 2.4x more debt cushion than UFCS.
Total debt $106.91M Interest coverage 7.32x -48% vs UFCS Carries about 1.9x less debt cushion than UFCS.
What you should know
The numbers
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Valuation
Profitability
Health
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Cash flow
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What you should know