A Look At Unum Group’s Valuation As Shares Weaken Despite Strong Profitability

Why Unum Group is on investors’ radar today

Unum Group (UNM) has drawn attention after a period of weaker share performance, with the stock showing negative returns over the past week, month and past 3 months despite solid profitability figures.

See our latest analysis for Unum Group.

At a share price of US$70.82, Unum Group’s recent 7 day and 30 day share price declines suggest momentum has cooled in the short term, even though the 3 year and 5 year total shareholder returns remain strong.

If this pullback has you looking across the market for other ideas, it could be a good time to broaden your watchlist with our screen of 23 top founder-led companies.

With Unum trading at US$70.82, alongside an intrinsic value estimate suggesting a discount and a gap to analyst targets, you have to ask yourself: is this a genuine value opportunity, or is the market already pricing in future growth?

Most Popular Narrative: 25.9% Undervalued

With Unum Group’s fair value narrative at $95.62 against a $70.82 share price, the current gap is all about long term earnings power and capital use.

Strong capital generation and excess liquidity (including an anticipated holding company cash position of $2-2.5 billion) position Unum to sustain elevated levels of shareholder returns through dividends and share buybacks, providing a pathway for EPS growth and continued financial flexibility.

Read the complete narrative.

Curious how this valuation leans so heavily on earnings resilience, margin assumptions, and buyback intensity, all run through a 6.96% discount rate? The full narrative lays out how steady top line growth, shifting profit margins and shrinking share count combine into that fair value outcome. If you want to see exactly which earnings and valuation assumptions need to hold for $95.62 to make sense, the detailed breakdown is the next step.

Result: Fair Value of $95.62 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, there are still meaningful risks, including pressure from elevated benefit ratios and long term care reserves, as well as sector wide pricing and competition squeezing future profitability assumptions.

Find out about the key risks to this Unum Group narrative.

Build Your Own Unum Group Narrative

If you are not completely on board with this view or you prefer to work from your own research, you can build a fresh narrative in just a few minutes with Do it your way

A great starting point for your Unum Group research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.

Looking for more investment ideas?

If Unum has sparked your interest, do not stop here. Use the Simply Wall St screener to uncover more opportunities that might suit your style and goals today.

• Target stability and income by reviewing companies we flag as potential income strongholds through our list of 16 dividend fortresses.
• Hunt for potential mispriced quality by scanning the market using our collection of 55 high quality undervalued stocks.
• Focus on financial resilience and sleep easier at night by checking companies in our 85 resilient stocks with low risk scores.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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