Wall Street Zen Downgrades United Fire Group (NASDAQ:UFCS) to Buy

Key Points

• Wall Street Zen downgraded United Fire Group from “strong buy” to “buy,” while the broader analyst consensus remains “Moderate Buy” with a $51.00 target price.
• United Fire Group exceeded quarterly expectations, reporting $1.16 in earnings per share versus the $0.87 consensus and revenue of $369.44 million versus estimates of $340.15 million.
• The company authorized a 2 million-share repurchase program, and a director purchased 4,500 shares—potential signals that management views the stock as undervalued.

United Fire Group (NASDAQ:UFCS - Get Free Report) was downgraded by research analysts at Wall Street Zen from a "strong-buy" rating to a "buy" rating in a research report issued on Sunday.

UFCS has been the topic of a number of other research reports. JonesTrading lifted their price objective on United Fire Group from $40.00 to $45.00 and gave the stock a "buy" rating in a research report on Thursday, May 7th. Zacks Research downgraded United Fire Group from a "strong-buy" rating to a "hold" rating in a research note on Monday, July 6th. Weiss Ratings reiterated a "buy (b)" rating on shares of United Fire Group in a report on Wednesday, May 13th. Finally, Piper Sandler lifted their target price on shares of United Fire Group from $45.00 to $57.00 and gave the stock an "overweight" rating in a research note on Thursday, May 7th. Three analysts have rated the stock with a Buy rating and one has issued a Hold rating to the company's stock. Based on data from MarketBeat, the stock presently has an average rating of "Moderate Buy" and a consensus target price of $51.00.

United Fire Group Stock Down 1.3%

Shares of NASDAQ UFCS opened at $51.36 on Friday. The firm has a market capitalization of $1.32 billion, a price-to-earnings ratio of 10.35 and a beta of 0.50. The company has a debt-to-equity ratio of 0.15, a quick ratio of 0.34 and a current ratio of 0.34. United Fire Group has a 52-week low of $25.79 and a 52-week high of $54.42. The stock has a 50 day moving average price of $49.43 and a 200 day moving average price of $42.71.

United Fire Group (NASDAQ:UFCS - Get Free Report) last released its earnings results on Tuesday, May 5th. The insurance provider reported $1.16 earnings per share for the quarter, topping analysts' consensus estimates of $0.87 by $0.29. The business had revenue of $369.44 million for the quarter, compared to analyst estimates of $340.15 million. United Fire Group had a net margin of 9.16% and a return on equity of 14.65%. Sell-side analysts expect that United Fire Group will post 4.69 earnings per share for the current year.

United Fire Group announced that its Board of Directors has initiated a stock repurchase plan on Wednesday, May 20th that authorizes the company to repurchase 2,000,000 outstanding shares. This repurchase authorization authorizes the insurance provider to purchase shares of its stock through open market purchases. Stock repurchase plans are often an indication that the company's management believes its shares are undervalued.

Insider Buying and Selling

In related news, Director George D. Milligan bought 4,500 shares of the stock in a transaction on Friday, June 5th. The stock was bought at an average price of $45.23 per share, with a total value of $203,535.00. Following the completion of the purchase, the director directly owned 90,034 shares in the company, valued at $4,072,237.82. This represents a 5.26% increase in their position. The acquisition was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this link. 6.06% of the stock is owned by insiders.

Hedge Funds Weigh In On United Fire Group

Several large investors have recently made changes to their positions in the stock. Smartleaf Asset Management LLC increased its holdings in United Fire Group by 129.4% in the 4th quarter. Smartleaf Asset Management LLC now owns 686 shares of the insurance provider's stock valued at $25,000 after purchasing an additional 387 shares during the last quarter. Basepoint Wealth LLC purchased a new stake in United Fire Group in the fourth quarter valued at approximately $26,000. Federated Hermes Inc. lifted its stake in United Fire Group by 109.5% during the fourth quarter. Federated Hermes Inc. now owns 1,190 shares of the insurance provider's stock worth $43,000 after purchasing an additional 622 shares in the last quarter. Kemnay Advisory Services Inc. acquired a new position in United Fire Group during the fourth quarter worth $48,000. Finally, Meeder Asset Management Inc. purchased a new position in shares of United Fire Group during the fourth quarter worth $53,000. 62.68% of the stock is currently owned by institutional investors and hedge funds.

About United Fire Group

United Fire Group, Inc NASDAQ: UFCS is an insurance holding company based in Cedar Rapids, Iowa, that specializes in property and casualty coverage for commercial and personal lines. The company underwrites business through three primary segments: commercial, personal and specialty insurance. Within the commercial segment, United Fire Group offers tailored policies for small- and medium-sized enterprises, including general liability, commercial property and workers' compensation. Its personal lines cover homeowners, auto, farm and umbrella policies.

United Fire Group distributes its products primarily through a national network of independent insurance agents and brokers.

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