1 Insurance Stock to Consider Right Now and 2 That Underwhelm

Insurance firms play a critical role in the financial system, offering everything from property coverage to life insurance and specialized risk solutions. Still, investors are uneasy as insurers face challenges from catastrophic events and potential regulatory changes. These doubts have certainly contributed to insurance stocks’ recent underperformance - over the past six months, the industry’s 1.7% gain has fallen behind the S&P 500’s 12% rise.

Despite the lackluster result, a few diamonds in the rough can produce earnings growth no matter what, and we started StockStory to help you find them. On that note, here is one resilient insurance stock at the top of our wish list and two that may face trouble.

Two Insurance Stocks to Sell:

The Hanover Insurance Group (THG)

Market Cap: $6.43 billion

Founded in 1852 during a time when fire insurance was crucial for protecting businesses and homes, The Hanover Insurance Group (NYSE:THG) provides property and casualty insurance products through independent agents, serving individuals, small businesses, and mid-sized companies.

Why Does THG Fall Short?

1. 5.1% annual revenue growth over the last two years was slower than its insurance peers
2. 4.6% annualized net premiums earned growth over the last two years lagged behind its insurance peers
3. Capital trends were unexciting over the last five years as its 2.6% annual book value per share growth was below the typical insurance firm

The Hanover Insurance Group is trading at $180.60 per share, or 1.8x forward P/B. If you’re considering THG for your portfolio, see our FREE research report to learn more.

Root (ROOT)

Market Cap: $1.07 billion

Pioneering a data-driven approach that rewards good driving habits, Root (NASDAQ:ROOT) is a technology-driven auto insurance company that uses mobile apps to acquire customers and data science to price policies based on individual driving behavior.

Why Do We Think Twice About ROOT?

1. Products and services are facing significant credit quality challenges during this cycle as book value per share has declined by 158% annually over the last five years
2. Negative return on equity shows management lost money while trying to expand the business

At $69.48 per share, Root trades at 3.4x forward P/B. Dive into our free research report to see why there are better opportunities than ROOT.

One Insurance Stock to Watch:

Primerica (PRI)

Market Cap: $8.35 billion

With a sales force of over 140,000 licensed representatives operating on an independent contractor model, Primerica (NYSE:PRI) provides term life insurance, investment products, and other financial services to middle-income households in the United States and Canada.

Why Does PRI Catch Our Eye?

1. Pre-tax profit margin improvement of 6.2 percentage points over the last five years demonstrates its ability to scale efficiently
2. Share repurchases over the last five years enabled its annual earnings per share growth of 18.1% to outpace its revenue gains
3. Stellar return on equity showcases management’s ability to surface highly profitable business ventures

Primerica’s stock price of $260.60 implies a valuation ratio of 3.5x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.

High-Quality Stocks for All Market Conditions

The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today

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