SIGI Stock Forecast & Price Target

Selective Insurance Group Inc. demonstrated significant revenue growth in 2024, with totals reaching $365.7 million, up from $282.8 million in 2022, primarily driven by strong performance in its Other Liability segment. The company is benefiting from rising interest rates and robust capital inflows, leading to a notable 12.9% return on equity after taxes in 2024, which contributes positively to its financial foundation. Furthermore, Selective's E&S unit has shown impressive profitability with sub-90 combined ratios, reflecting effective management strategies and improvements in loss picks and IBNR positions.

Selective Insurance Group Inc. has faced significant headwinds, exemplified by a 103% combined ratio last year that resulted in a decline in cash incentive payouts and reflects a troubling trend in operational efficiency. The company has been mis-positioned within its market compared to peers, as it anticipates a slowdown in growth coupled with substantial underwriting losses and ongoing reserve issues that have deterred investor confidence. Furthermore, persistent misses in guidance related to catastrophe losses and reserving, along with an underperformance in return on equity, suggest limited near-term upside potential for earnings per share.