EG Stock Trading at a Discount to Industry at 1.02X: Time to Hold?

Everest Group, Ltd. EG shares are trading at a discount compared to the Zacks Multi-line Insurance industry. Its forward price-to-book value of 1.02X is lower than the industry average of 2.46X, the Finance sector’s 4.3X and the Zacks S&P 500 Composite’s 7.98X. The multi-line insurer has a Value Score of A.

Shares of EverQuote, Inc. EVER are trading at a multiple higher than the industry average, while Radian Group Inc. RDN and Old Republic International Corporation ORI shares are trading at a discount.

The insurer has a market capitalization of $14.48 billion. The average volume of shares traded in the last three months was 0.4 million.

EG’s Growth Projection Encourages 

The Zacks Consensus Estimate for Everest Group’s 2025 earnings per share indicates a year-over-year increase of 53.9%. The consensus estimate for revenues is pegged at $17.70 billion, implying a year-over-year improvement of 2.4%.  

The consensus estimate for 2026 earnings per share and revenues indicates an increase of 33.5% and 3.7%, respectively, from the corresponding 2025 estimates.  

Earnings have grown 21.4% in the past five years, better than the industry average of 10.3%. The expected long-term earnings growth rate is 28.2%, outperforming the industry average of 12.5%. 

Bearish Analyst Sentiment on EG

The Zacks Consensus Estimate for 2025 earnings has moved down 3% in the past 30 days, while the same for 2026 has moved down 1% in the same time frame.

EG Price Performance

Shares of Everest Group have lost 12.1% in the past year, underperforming the industry, the Finance sector and the Zacks S&P 500 composite’s growth of 4.8%, 17.9%, and 10.9%, respectively. 

EG Lags Industry, Sector, S&P in 1 Year

Factors Impacting Everest Group 

Global presence, product diversification, rate increase and high retention rate continue to drive EG’s overall growth. The Insurance segment is poised to benefit from an increase in property and short-tail business and a rise in specialty casualty business. On the other hand, leveraging opportunities stemming from the continued disruption and evolution of the reinsurance market should position the Reinsurance segment for growth. 

Net investment income stands to benefit from higher income from the fixed income portfolio, an increase in limited partnership income, a rise in dividend income from the equity portfolio and higher income from other invested assets. An improved interest rate environment adds to the upside. 

Everest Group has a strong capital position, banking on sufficient cash generation capabilities and benefits from capital adequacy, financial flexibility, long-term operating performance and traditional risk management capabilities. The multi-line insurer targets a 15-20% long-term debt leverage ratio for three years. 

Wealth Distribution of EG  

Everest Group is expected to benefit from its capital adequacy, financial flexibility, long-term operating performance and traditional risk management capabilities. In May 2024, its board approved a 14.3% hike in its quarterly dividend. Everest Group targets a total shareholder return on equity of more than 17% from 2024 to 2026. EG expects to continue repurchasing shares throughout 2025. It reflects the robust and well-diversified earnings power of Everest. EG expects to make consistent payouts, along with buybacks, given its disciplined capital management strategy and strong capital balance.  

Final Take on EG

Higher income from the fixed income portfolio, product diversification, strong renewal retention, prudent capital deployment and a solid capital position make Everest Group a strong contender for being in one’s portfolio. Favorable estimates and attractive valuation also add to the upside. 

The stock also has a VGM Score of B. VGM Score helps identify stocks with the most attractive value, best growth and the most promising momentum.

However, given bearish analysts’ sentiment, it is better to wait for some more time before taking a call on this Zacks Rank #3 (Hold) stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

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This article originally published on Zacks Investment Research (zacks.com).

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