10Y annualized return is
positive but below market average
at 7.2% per year
EG has met or exceeded earnings expectations in
the majority of
recent quarters (7/10)
Attractive Price-to-Earnings Ratio
Low Price-to-Sales Ratio
Healthy Return on Equity
Strong Operating Profit Margin
Excellent Liquidity Ratios
Low Debt Levels
🏢 Strong Underwriting Discipline
📈 Resilient Financial Performance
🌍 Strong International Growth
🚀 Focus on Growth in Specialty Lines
🔍 Strategic Capital Management
High EV/EBITDA Ratio
Net Profit Margin Needs Improvement
⚠️ High Combined Ratio
📉 Casualty Portfolio Weakness
🛑 Volatility Risks
🌀 Impact of Catastrophes
Everest Group Limited exhibits strong underwriting discipline and international growth, contributing to its overall resilience. However, challenges such as a high combined ratio and weaknesses in the casualty portfolio present risks. The company's future prospects are bolstered by a focus on specialty lines and strategic capital management, but volatility and catastrophe exposure remain concerns.
Analysis Date: February 4, 2025
Last Updated: April 12, 2025
Past performance does not guarantee future results. The data presented is indicative and may not be updated in real-time.
Everest Re Group, Ltd. is a company that provides insurance and reinsurance services. In simple terms, they help other insurance companies protect themselves from big losses by sharing some of the risk. They offer different types of coverage, like insurance for homes, businesses, and special situations like medical malpractice. They operate in many countries, including the United States and Bermuda, making sure that people and businesses have support when unexpected events happen.
Core Products
Business Type
Business to Business
Competitive Advantages
Key Business Risks
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$1244.41
Current Market Price: $340.63
IV/P Ratio: 3.65x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
73.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for EG
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (10.43)
P/B ratio ≤ 1.5 (1.03)
Current ratio ≥ 2.0 (14.42x)
Long-term debt < Net current assets (0.11x)
Margin of safety (73.0%)
EG meets all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
9.63%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-30)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
100.13%
Higher values indicate better efficiency in production
TTM (as of 2025-04-30)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
7.95%
Higher values indicate better overall profitability
TTM (as of 2025-04-30)
EG boasts a return on equity (ROE) of 9.63%, indicating that the company is effectively generating profit from its shareholders' equity.
An operating profit margin of 13.30% reflects the company's efficiency in managing its operational costs relative to its revenue.
With a net profit margin of 7.95%, there is room for improvement in profitability after all expenses are accounted for.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.26x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
14.42x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
EG has a current ratio of 14.42 and a quick ratio of 14.42, indicating outstanding short-term liquidity and the ability to cover its liabilities.
A debt-to-equity ratio of 0.26 and debt-to-assets ratio of 0.06 demonstrate a conservative approach to leveraging, indicating financial stability.
Meeting Expectations
Higher values indicate better execution and credibility
Recent Results
EPS
Everest has demonstrated a strong commitment to underwriting discipline, which has allowed it to selectively choose high-quality clients. For instance, the company walked away from nearly $750 million in North American casualty quota share business that did not meet its return expectations.
Despite facing significant losses from catastrophes, Everest reported $1.3 billion in operating income for the year and achieved a 9% operating return on equity. This indicates resilience in its business model.
Everest's international operations saw growth in key short-tail and specialty lines, contributing positively to its overall performance. This is indicative of a diversified portfolio and market presence.
The combined ratio for the fourth quarter was reported at 135.5%, which is significantly above the acceptable range and indicates challenges in profitability.
The U.S. casualty segment has shown significant weakness, leading to a reduction in premiums and necessitating reserve strengthening actions totaling $1.7 billion for the year.
Everest plans to focus on increasing scale in specialty lines and short-tail business, which have shown stronger performance and better margins. This strategic focus can lead to improved future profitability.
The company is positioned to execute strategic initiatives and is looking to opportunistically repurchase shares, indicating confidence in its future cash flows and performance.
The non-renewal of significant casualty business could impact future revenue streams, and the ongoing challenges in the casualty market may pose risks to stability and growth.
The potential for significant losses from future catastrophic events remains a concern, as demonstrated by the recent California wildfires, which could affect overall profitability and market conditions.