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Unum Group Trades Above 200-Day SMA: Time to Buy or Hold the Stock?
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Key Takeaways
UNM expects 2026 premium growth of 4-7% driven by persistency and new sales.
Unum projects adjusted operating EPS of $8.60-$8.90, implying 8-12% growth in 2026.
UNM faces pressure from rising expenses, weaker investment income and soft Closed Block results.
Unum Group (UNM - Free Report) has been trading above its 200-day simple moving average (SMA), signalling a short-term bullish trend. Its share price as of Friday was $81.64, down 1.8% from its 52-week high of $83.13.
Image Source: Zacks Investment Research
The 200-day SMA is a long-term technical indicator that averages a stock's closing price over the last 200 trading days to smooth out volatility and identify the broader trend direction. When the stock price crosses above the 200-day SMA, it can be a signal to buy or hold.
UNM's Price Performance
Shares of Unum Group have declined 0.7% in the past year against the industry’s growth of 7.7%.
Image Source: Zacks Investment Research
UNM’s Attractive Valuation
Unum Group’s shares are trading at a discount compared to the Zacks Accident and Health Insurance industry. Its forward price-to-book value of 1.2X is lower than the industry average of 1.74X, the Finance sector’s 4.34X and the Zacks S&P 500 Composite’s 8.17X.
Image Source: Zacks Investment Research
Shares of AMERISAFE, Inc.(AMSF - Free Report) , Globe Life Inc. (GL - Free Report) and Aflac Incorporated (AFL - Free Report) are trading at a multiple higher than the industry average.
Zack Estimates of UNM
The Zacks Consensus Estimate for Unum Group’s 2026 revenues is pegged at $11.9 billion, implying a year-over-year decline of 9.7%. The consensus estimate for 2027 earnings per share and revenues indicates an increase of 11.1% and 3.9%, respectively, from the corresponding 2026 estimates.
Earnings have grown 10.6% in the past five years, outperforming the industry average of 0.6%. The expected long-term earnings growth rate is 11.3%, better than the industry average of 9.7%.
Average Target Price for UNM Suggests Upside
Based on short-term price targets offered by 13 analysts, the Zacks average price target is $96.23 per share. The average suggests a potential 18.9% upside from the last closing price.
Return on Capital of UNM
Return on invested capital in the trailing 12 months was 7.3%, better than the industry average of 6.6%, reflecting UNM’s efficiency in utilizing funds to generate income
Factors Impacting UNM
Premiums, the primary component of UNM’s top line, continue to gain from its healthy in-force block growth and higher sales. In 2026, Unum Group anticipates total premium growth of 4-7% in 2026, driven by persistency and new sales. UNM expects adjusted operating income per share to be between $8.60 and $8.90, indicating growth of about 8% to 12%.
Unum Group is poised to grow on the operational excellence of Unum U.S. and Colonial Life. Unum U.S. continues to benefit from disciplined sales trends, strong persistency in group lines and growth in new product lines like dental and vision. Better performance in this segment is likely to drive premium growth, which might substantially add to the company’s overall performance. Unum U.S. sales are driven by strong voluntary benefit sales. The pipeline for group sales over the next two quarters is healthy.
Operating income in the Colonial Life Segment has risen over the last few years, banking on improving premium income and favorable risk results. The company's conservative pricing and reservation practices have contributed to its overall profitability. Premium income should continue to increase due to prior period sales across all product lines. Management remains focused on moving toward a mix of businesses with higher growth and stable margins.
Unum Group enjoys a solid capital position and substantial statutory earnings and capital, leading to financial flexibility. It also has a track record of hiking dividends 17 times in the last 16 years.
Risks for UNM
Unum Group has been witnessing a rise in total benefits and expenses for the past few years inducing margin contraction. Total benefits and expenses escalated over the last five years. UNM expects the adjusted operating expense ratio to be 22%
Performances at the Closed Block and Corporate segment have also been disappointing over the past few quarters.
Net investment income has decreased as the majority of investments were made at a lower level of interest rates, reflecting the prevailing trend over the last few decades.
Conclusion
Favorable sales trends, strong persistency, an improving rate environment, solid capital position and effective capital deployment should continue to favour UNM over the long term. However, weak performances at the Closed Block and Corporate segment over the past few quarters and a rise in total benefits and expenses over the past few years, inducing margin contraction, remain concerns.
The company’s dividend yield was 2.5%, higher than the industry average of 2%, making it an attractive pick for yield-seeking investors.
The insurer should continue to gain from a favourable return on capital, dividend history, and the attractive valuation of the stock. It is, therefore, wise to retain this Zacks Rank #3 (Hold) stock at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Unum Group Trades Above 200-Day SMA: Time to Buy or Hold the Stock?
Key Takeaways
Unum Group (UNM - Free Report) has been trading above its 200-day simple moving average (SMA), signalling a short-term bullish trend. Its share price as of Friday was $81.64, down 1.8% from its 52-week high of $83.13.
Image Source: Zacks Investment Research
The 200-day SMA is a long-term technical indicator that averages a stock's closing price over the last 200 trading days to smooth out volatility and identify the broader trend direction. When the stock price crosses above the 200-day SMA, it can be a signal to buy or hold.
UNM's Price Performance
Shares of Unum Group have declined 0.7% in the past year against the industry’s growth of 7.7%.
Image Source: Zacks Investment Research
UNM’s Attractive Valuation
Unum Group’s shares are trading at a discount compared to the Zacks Accident and Health Insurance industry. Its forward price-to-book value of 1.2X is lower than the industry average of 1.74X, the Finance sector’s 4.34X and the Zacks S&P 500 Composite’s 8.17X.
Image Source: Zacks Investment Research
Shares of AMERISAFE, Inc.(AMSF - Free Report) , Globe Life Inc. (GL - Free Report) and Aflac Incorporated (AFL - Free Report) are trading at a multiple higher than the industry average.
Zack Estimates of UNM
The Zacks Consensus Estimate for Unum Group’s 2026 revenues is pegged at $11.9 billion, implying a year-over-year decline of 9.7%. The consensus estimate for 2027 earnings per share and revenues indicates an increase of 11.1% and 3.9%, respectively, from the corresponding 2026 estimates.
Earnings have grown 10.6% in the past five years, outperforming the industry average of 0.6%. The expected long-term earnings growth rate is 11.3%, better than the industry average of 9.7%.
Average Target Price for UNM Suggests Upside
Based on short-term price targets offered by 13 analysts, the Zacks average price target is $96.23 per share. The average suggests a potential 18.9% upside from the last closing price.
Return on Capital of UNM
Return on invested capital in the trailing 12 months was 7.3%, better than the industry average of 6.6%, reflecting UNM’s efficiency in utilizing funds to generate income
Factors Impacting UNM
Premiums, the primary component of UNM’s top line, continue to gain from its healthy in-force block growth and higher sales. In 2026, Unum Group anticipates total premium growth of 4-7% in 2026, driven by persistency and new sales. UNM expects adjusted operating income per share to be between $8.60 and $8.90, indicating growth of about 8% to 12%.
Unum Group is poised to grow on the operational excellence of Unum U.S. and Colonial Life. Unum U.S. continues to benefit from disciplined sales trends, strong persistency in group lines and growth in new product lines like dental and vision. Better performance in this segment is likely to drive premium growth, which might substantially add to the company’s overall performance. Unum U.S. sales are driven by strong voluntary benefit sales. The pipeline for group sales over the next two quarters is healthy.
Operating income in the Colonial Life Segment has risen over the last few years, banking on improving premium income and favorable risk results. The company's conservative pricing and reservation practices have contributed to its overall profitability. Premium income should continue to increase due to prior period sales across all product lines. Management remains focused on moving toward a mix of businesses with higher growth and stable margins.
Unum Group enjoys a solid capital position and substantial statutory earnings and capital, leading to financial flexibility. It also has a track record of hiking dividends 17 times in the last 16 years.
Risks for UNM
Unum Group has been witnessing a rise in total benefits and expenses for the past few years inducing margin contraction. Total benefits and expenses escalated over the last five years. UNM expects the adjusted operating expense ratio to be 22%
Performances at the Closed Block and Corporate segment have also been disappointing over the past few quarters.
Net investment income has decreased as the majority of investments were made at a lower level of interest rates, reflecting the prevailing trend over the last few decades.
Conclusion
Favorable sales trends, strong persistency, an improving rate environment, solid capital position and effective capital deployment should continue to favour UNM over the long term. However, weak performances at the Closed Block and Corporate segment over the past few quarters and a rise in total benefits and expenses over the past few years, inducing margin contraction, remain concerns.
The company’s dividend yield was 2.5%, higher than the industry average of 2%, making it an attractive pick for yield-seeking investors.
The insurer should continue to gain from a favourable return on capital, dividend history, and the attractive valuation of the stock. It is, therefore, wise to retain this Zacks Rank #3 (Hold) stock at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.