Shares of United Fire Group (UFCS) have been strong performers lately, with the stock up 10.8% over the past month. The stock hit a new 52-week high of $40.63 in the previous session. United Fire has gained 8.9% since the start of the year compared to the 0% gain for the Zacks Finance sector and the -0.5% return for the Zacks Insurance - Property and Casualty industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on February 10, 2026, United Fire reported EPS of $1.5 versus consensus estimate of $0.9.
For the current fiscal year, United Fire is expected to post earnings of $3.55 per share on $1.52 in revenues. This represents a -22.83% change in EPS on a 9.59% change in revenues. For the next fiscal year, the company is expected to earn $3.7 per share on $1.66 in revenues. This represents a year-over-year change of 4.23% and 9.58%, respectively.
Valuation Metrics
While United Fire has moved to its 52-week high over the past few weeks, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
United Fire has a Value Score of A. The stock's Growth and Momentum Scores are D and D, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 11.2X current fiscal year EPS estimates, which is a premium to the peer industry average of 10.7X. On a trailing cash flow basis, the stock currently trades at 13X versus its peer group's average of 11.4X. This is good enough to put the company in the top echelon of all stocks we cover from a value perspective, making United Fire an interesting choice for value investors.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, United Fire currently has a Zacks Rank of #2 (Buy) thanks to a solid earnings estimate revision trend.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if United Fire passes the test. Thus, it seems as though United Fire shares could have a bit more room to run in the near term.
How Does UFCS Stack Up to the Competition?
Shares of UFCS have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is The Hanover Insurance Group, Inc. (THG). THG has a Zacks Rank of #2 (Buy) and a Value Score of A, a Growth Score of B, and a Momentum Score of D.
Earnings were strong last quarter. The Hanover Insurance Group, Inc. beat our consensus estimate by 11.35%, and for the current fiscal year, THG is expected to post earnings of $16.85 per share on revenue of $6.97 billion.
Shares of The Hanover Insurance Group, Inc. have gained 0.8% over the past month, and currently trade at a forward P/E of 10.17X and a P/CF of 12.5X.
The Insurance - Property and Casualty industry may rank in the bottom 59% of all the industries we have in our universe, but there still looks like there are some nice tailwinds for UFCS and THG, even beyond their own solid fundamental situation.
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United Fire Group, Inc (UFCS): Free Stock Analysis Report The Hanover Insurance Group, Inc. (THG): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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