Donegal Group Inc. (DGICA) AI Stock Analysis

Donegal Group Inc. is an insurance holding company that provides personal and commercial property and casualty insurance products across three primary segments: the Investment Function, Personal Lines of Insurance, and Commercial Lines of Insurance. Its personal lines include private passenger automobile and homeowners policies, while its commercial segment provides commercial automobile, multi-peril, and workers' compensation coverage. Founded in 1986 and headquartered in Marietta, Pennsylvania, the company distributes its insurance solutions primarily across the Mid-Atlantic, Midwestern, New England, Southern, and Southwestern regions through a network of approximately 2,300 independent insurance agencies.

Between FY2021 and FY2025, Donegal Group increased revenue from $816.5M to $978.0M, achieving a 5-year revenue CAGR of 4.7%. Net income improved from $25.3M in FY2021 to $79.3M in FY2025, rebounding from a loss of -$2.0M in FY2022. Operating margin rose from 3.7% in FY2021 to 10.0% in FY2025, lifting annual EPS to $2.17. Over the trailing twelve months, revenue stood at $963.2M with an operating margin of 11.6%. In the latest quarter ended June 30, 2026, quarterly revenue fell 2.4% year-over-year, while quarterly earnings grew 30.3%.

As of June 30, 2026, Donegal Group held $492.6M in cash and short-term investments against $35.0M in total debt, leaving net cash of $457.6M. Shareholders' equity totaled $666.1M against total assets of $2.48B. The company recorded a current ratio of 0.74 and a debt-to-equity ratio of 0.05. In FY2025, operating cash flow and free cash flow were both $70.2M, while capital expenditures totaled $425 and dividends paid were $25.7M.

At $18.68 per share, Donegal Group trades at a trailing P/E of 9.7x, below the 12.1x median of its US-listed Financial Services peers. Its forward P/E of 16.0x is above the peer median of 10.8x. The company trades at a price-to-sales ratio of 0.7x and a price-to-book ratio of 1.0x, compared to the peer median price-to-sales of 3.2x. Over the past year, the stock gained 1.3%, lagging the S&P 500 (SPY) return of 16.8%, and its 5-year gain of 58.3% trailed the index return of 83.0%.

Donegal Group pays a quarterly dividend with an annual forward rate of $0.77, representing a dividend yield of 4.12%. Its payout ratio is 40.1%, backed by 26 consecutive years of dividend payments. Over the past five years, the dividend grew at an annualized rate of 3.9%, and the stock last traded ex-dividend on July 31, 2026.

Wall Street coverage on Donegal Group includes 1 Strong Buy, 0 Buys, 1 Hold, and 0 Sells. The mean price target of $21.00 represents a 12.4% premium over the last close of $18.68. For the fiscal year ending December 31, 2026, consensus estimates project EPS of $1.80 on revenue of $949.4M. Donegal Group beat EPS expectations in 3 of the last 4 quarters, with its next earnings report scheduled for October 29, 2026.

This page is an AI-written research summary of Donegal Group Inc. (DGICA). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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