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EG Stock Trading at a Discount to Industry at 0.9X: Time to Hold?
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Key Takeaways
Everest Group's reinsurance unit is the sixth largest globally by GPW and contributes 71% of total GPW.
EG sees rising investment income from fixed maturities, short-term assets, and higher partnership income.
Everest Group expands in Mexico, Colombia, Australia, and Italy to tap into growing insurance demand.
Everest Group, Ltd. (EG - Free Report) shares are trading at a discount compared with the Zacks Multi-line Insurance industry. Its forward price-to-book value of 0.92X is lower than the industry average of 2.57X, the Finance sector’s 4.35X, and the Zacks S&P 500 composite’s 8.38X.
Everest Group underwrites property and casualty reinsurance and insurance in the United States and international markets. The company is poised for growth on product diversification, international insurance expansion, rise in fixed maturity investments.
Image Source: Zacks Investment Research
The insurer has a market capitalization of $14.2 billion. The average volume of shares traded in the last three months was 0.36 million.
Shares of other insurers like American International Group (AIG - Free Report) , Aegon NV(AEG - Free Report) and Assurant, Inc. (AIZ - Free Report) are trading at a discount to the industry average.
EG’s Price Performance
Shares of Everest Group have gained 2.2% over the past year compared with the industry’s growth of 10.3%.
Image Source: Zacks Investment Research
EG’s Growth Projection
The Zacks Consensus Estimate for Everest Group’s 2026 earnings per share is pinned at $53.17, indicating a year-over-year increase of 19.3%. The estimate for 2026 revenues is pegged at $14.46 billion, implying a year-over-year decline of 5.9%.
The consensus estimate for 2027 earnings per share and revenues indicates an increase of 12.1%, while revenues indicate a decrease of 3.6% from the corresponding 2026 estimates.
Earnings of EG grew 58.4% in the last five years, better than the industry average of 22.5%. The expected long-term earnings growth is pegged at 25.2%, better than the industry average of 11.3%.
Average Target Price for EG Suggests Upside
Based on short-term price targets offered by 16 analysts, the Zacks average price target is $367.56 per share. The average suggests a potential 4.8% upside from the last closing price.
Image Source: Zacks Investment Research
What’s Driving EG?
Everest Group’s Reinsurance business is the sixth largest globally, based on gross premiums written. The segment contributes 71% of total premiums and has shown consistent growth over the past five years, highlighting its role as the core earnings driver. This growth is supported by favorable pricing conditions and rising demand for reinsurance, driven by increasing catastrophe risks. Everest Group’s geographical diversity spanning 100 countries across six continents lends further stability to its reinsurance business.
The company has been witnessing a rise in investment income over the past couple of years. The key drivers of net investment income are higher income from fixed maturity investments, an increase in short-term investments and a rise in income from other invested assets. Higher limited partnership income and increased assets under management should add to the upside. EG expects investment returns to range between 5% and 6% in the upcoming years.
Everest Group is actively scaling operations in markets such as Mexico, Colombia, Australia, and Italy, targeting regions with strong insurance demand and underpenetrated segments. Mexico and Colombia offer growth opportunities driven by rising insurance adoption and demand for customized solutions, while Australia and Italy provide exposure to developed markets with increasing need for specialty and non-life coverage.
Everest Group’s accelerating technology adoption is a compelling catalyst for margin expansion and disciplined growth. International expansion, along with EG’s technology-led underwriting and diversified product offerings, is strengthening its global presence. Management expects continued growth supported by strong underwriting discipline and favorable loss ratios, positioning the international segment as a key long-term growth driver.
Everest Group boasts a strong capital position with sufficient cash generation capabilities. It exited 2025 with total investments and cash of $45.4 billion, up 9.4% from the 2024 level. The company targets a 15 to 20% long-term debt leverage ratio for a term of three years.
In 2025, EG repurchased shares worth $800 million and expects to continue repurchasing shares throughout 2026. The company's board recently approved a share buyback program of $10 million
Risks for EG Stock
Everest Group faces foreign exchange risk as it operates in currencies like the euro, pound, and Canadian dollar while reporting in U.S. dollars. Fluctuations in exchange rates can lead to translation losses, impacting net income and capital levels.
EG has seen fluctuating return on equity (ROE) in recent years, partly due to its 2023 equity raise of $1.5 billion, which expanded the capital base and diluted returns. ROE remains below the industry average despite improving in 2025.
Conclusion
Everest Group is poised for growth on product diversification, international insurance expansion, a rise in investment income and financial flexibility. However, foreign exchange volatility and lower return on equity continue to weigh on net income and capital efficiency.
View the Zacks #1 Rank List
Image: Bigstock
EG Stock Trading at a Discount to Industry at 0.9X: Time to Hold?
Key Takeaways
Everest Group, Ltd. (EG - Free Report) shares are trading at a discount compared with the Zacks Multi-line Insurance industry. Its forward price-to-book value of 0.92X is lower than the industry average of 2.57X, the Finance sector’s 4.35X, and the Zacks S&P 500 composite’s 8.38X.
Everest Group underwrites property and casualty reinsurance and insurance in the United States and international markets. The company is poised for growth on product diversification, international insurance expansion, rise in fixed maturity investments.
Image Source: Zacks Investment Research
The insurer has a market capitalization of $14.2 billion. The average volume of shares traded in the last three months was 0.36 million.
Shares of other insurers like American International Group (AIG - Free Report) , Aegon NV(AEG - Free Report) and Assurant, Inc. (AIZ - Free Report) are trading at a discount to the industry average.
EG’s Price Performance
Shares of Everest Group have gained 2.2% over the past year compared with the industry’s growth of 10.3%.
Image Source: Zacks Investment Research
EG’s Growth Projection
The Zacks Consensus Estimate for Everest Group’s 2026 earnings per share is pinned at $53.17, indicating a year-over-year increase of 19.3%. The estimate for 2026 revenues is pegged at $14.46 billion, implying a year-over-year decline of 5.9%.
The consensus estimate for 2027 earnings per share and revenues indicates an increase of 12.1%, while revenues indicate a decrease of 3.6% from the corresponding 2026 estimates.
Earnings of EG grew 58.4% in the last five years, better than the industry average of 22.5%. The expected long-term earnings growth is pegged at 25.2%, better than the industry average of 11.3%.
Average Target Price for EG Suggests Upside
Based on short-term price targets offered by 16 analysts, the Zacks average price target is $367.56 per share. The average suggests a potential 4.8% upside from the last closing price.
Image Source: Zacks Investment Research
What’s Driving EG?
Everest Group’s Reinsurance business is the sixth largest globally, based on gross premiums written. The segment contributes 71% of total premiums and has shown consistent growth over the past five years, highlighting its role as the core earnings driver. This growth is supported by favorable pricing conditions and rising demand for reinsurance, driven by increasing catastrophe risks. Everest Group’s geographical diversity spanning 100 countries across six continents lends further stability to its reinsurance business.
The company has been witnessing a rise in investment income over the past couple of years. The key drivers of net investment income are higher income from fixed maturity investments, an increase in short-term investments and a rise in income from other invested assets. Higher limited partnership income and increased assets under management should add to the upside. EG expects investment returns to range between 5% and 6% in the upcoming years.
Everest Group is actively scaling operations in markets such as Mexico, Colombia, Australia, and Italy, targeting regions with strong insurance demand and underpenetrated segments. Mexico and Colombia offer growth opportunities driven by rising insurance adoption and demand for customized solutions, while Australia and Italy provide exposure to developed markets with increasing need for specialty and non-life coverage.
Everest Group’s accelerating technology adoption is a compelling catalyst for margin expansion and disciplined growth. International expansion, along with EG’s technology-led underwriting and diversified product offerings, is strengthening its global presence. Management expects continued growth supported by strong underwriting discipline and favorable loss ratios, positioning the international segment as a key long-term growth driver.
Everest Group boasts a strong capital position with sufficient cash generation capabilities. It exited 2025 with total investments and cash of $45.4 billion, up 9.4% from the 2024 level. The company targets a 15 to 20% long-term debt leverage ratio for a term of three years.
In 2025, EG repurchased shares worth $800 million and expects to continue repurchasing shares throughout 2026. The company's board recently approved a share buyback program of $10 million
Risks for EG Stock
Everest Group faces foreign exchange risk as it operates in currencies like the euro, pound, and Canadian dollar while reporting in U.S. dollars. Fluctuations in exchange rates can lead to translation losses, impacting net income and capital levels.
EG has seen fluctuating return on equity (ROE) in recent years, partly due to its 2023 equity raise of $1.5 billion, which expanded the capital base and diluted returns. ROE remains below the industry average despite improving in 2025.
Conclusion
Everest Group is poised for growth on product diversification, international insurance expansion, a rise in investment income and financial flexibility. However, foreign exchange volatility and lower return on equity continue to weigh on net income and capital efficiency.
It is, therefore, wise to retain this Zacks Rank #3 (Hold) stock presently. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.