UNIVERSAL INSURANCE HOLDINGS INC Common Stock (UVE)

FairStock Score: 88/100 — HIGH CONVICTION

Key Financials

Strengths

• High return on equity of 39.6% demonstrating efficient capital deployment
• Conservative balance sheet with debt-to-equity of just 0.18, providing financial flexibility
• FairStock composite score of 88/100 places it in the top tier across value, quality, and momentum factors

Concerns

• Altman Z-Score of 0.8 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

UNIVERSAL INSURANCE HOLDINGS INC Common Stock is a micro-cap financial services company valued at $978 million. The business generates $1.6 billion in annual revenue with a 3.4% net margin. From a quality standpoint, UNIVERSAL shows distressed Altman Z-Score of 0.8 warrants caution and strong 40% ROE. On valuation, the stock is deeply undervalued on a P/E basis at 5.6x, with offers a 34% margin of safety vs Graham Number of $53. Growth dynamics show revenue growing at 6.0% and profit growth of 1006.5%. The 1.9% dividend yield adds an income component for patient holders. Our composite FairStock Score of 88/100 reflects strong fundamentals overall. This combination of reasonable valuation, solid returns, and conservative leverage makes it worth a closer look for value-oriented portfolios.

Bull Case

The market underappreciates UNIVERSAL's consistent 40% ROE at just 6x earnings—a re-rating toward sector peers could unlock 30-50% upside. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the financial services space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer