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what it is
Donegal sells home, auto, and business insurance across 21 states and invests the float while it waits to pay claims.
how it gets paid
Last year Donegal made $978M in revenue. commercial automobile was the main engine at $235.0M, or 24% of sales.
why growth slowed
Revenue fell 1.2% last year. Shows quarterly EPS improving from $0.16, $0.11, $0.46, and $0.70 in 2024 for a full-year $1.38.
what just happened
Donegal's last reported quarter showed $738M in revenue and Yahoo Finance lists EPS at $0.55, capping a huge earnings recovery year.
At a glance
B+ balance sheet — decent shape, but not bulletproof
25/100 earnings predictability — expect surprises
7.8x trailing p/e — the market's not buying it — or you found a deal
4.4% dividend yield — cash in your pocket every quarter
8.8% return on capital — nothing to write home about
xvary composite: 55/100 — below average
What they do
Donegal sells home, auto, and business insurance across 21 states and invests the float while it waits to pay claims.
Insurance float → premium cash held before claims are paid → it gives Donegal money to invest first. That matters because Donegal runs in 21 states with 851 employees, which is small enough to stay local but large enough to spread risk across multiple markets. If you are a policyholder, you usually buy insurance from whoever already knows your town, your agent, and your loss history.
How they make money
$978M
annual revenue · their business grew -1.2% last year
commercial automobile
$235.0M
commercial multi-peril
$189.0M
workers' compensation
$128.8M
homeowners
$190.0M
private passenger automobile
$178.6M
investment function
$56.6M
The products that matter
business insurance policies
Commercial Lines
$635M · about 65% of premiums
it is the core book. $635M of the company’s $978M in annual premiums comes from here, and even this segment still slipped 0.8% last year.
largest segment
consumer insurance policies
Personal Lines
$343M · about 35% of premiums
this $343M segment fell 2.0%. that matters because the smaller book is shrinking faster than the company total.
faster decline
invests insurance float
Investment Portfolio
$1.5B portfolio
it is not shown here as a premium segment, but it still moves results. last quarter the portfolio produced a $1.4M after-tax loss, and that went straight into net income.
earnings swing factor
Key numbers
7.8x
trailing p/e
P/E → price-to-earnings → how much you pay for each dollar of profit. At 7.8x, the stock is priced like the recovery will not last.
4.4%
dividend yield
Dividend yield → cash paid back to shareholders each year as a share of price → you are paid to wait, if earnings hold.
$978M
ttm revenue
This is the size of the business today, and it declined 1.2% vs. prior year, so pricing power still needs proof.
8.8%
return on capital
Return on capital → profit earned on the money tied up in the business → decent, not elite, for an insurer.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 40 / 100
- long-term debt $35M (29% of capital)
B+ — functional but not a standout on the balance sheet.
Total return vs. market
Return history isn't available for DGICB right now.
source: institutional data · return history unavailable
What just happened
beat estimates
Donegal's last reported quarter showed $738M in revenue and Yahoo Finance lists EPS at $0.55, capping a huge earnings recovery year.
Value Line shows quarterly EPS improving from $0.16, $0.11, $0.46, and $0.70 in 2024 for a full-year $1.38. EDGAR shows quarterly revenue of $738M, up 200% vs. prior year, though that figure sits awkwardly against the $978M annual revenue base and deserves caution.
$738M
revenue
$0.55
eps
n/a
n/a
the number that mattered
The key number is $1.38 in full-year 2024 EPS versus $0.11 in 2023, because that is the difference between a broken insurer and a merely cheap one.
source: company earnings report, 2026
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What could go wrong
your #1 risk is continued premium contraction across both personal and commercial lines.
high
premium contraction
Total earned premiums fell 1.2% to $978M. Personal lines dropped 2.0%. Commercial lines dropped 0.8%. If management keeps favoring underwriting discipline over volume, the book can stay respectable and still keep shrinking.
A 5% further decline would remove about $49M from earned premiums. That would hit scale before it hit the dividend story.
med
Guidewire cloud migration
Donegal announced a multi-year core systems migration to Guidewire Cloud. That can improve operations over time. Tech conversions are also famous for overruns, delays, and internal distraction.
Unexpected implementation costs would pressure an 8.11% profit margin that does not have much extra cushion.
med
investment portfolio volatility
Donegal carries a $1.5B investment portfolio. Last quarter it booked $1.4M in after-tax investment losses. One quarter is manageable. A pattern would make already uneven earnings even less predictable.
Portfolio losses hit net income directly, even if underwriting trends look unchanged on the surface.
The combined risk picture is blunt: shrinking premiums pressure scale, conversion costs pressure margin, and portfolio losses pressure earnings. The first one still drives the entire story.
source: institutional data · regulatory filings · risk analysis
Pay attention to
trend
premium growth turning back above zero
This is the whole story. If earned premiums stop shrinking, the stock can work from a low multiple and a 4.4% yield. If they do not, 7.8x earnings is not the bargain it looks like.
calendar
q1 2026 earnings report
Due May 2026. Watch whether personal lines is still falling faster than commercial lines. Same insurer. Different speeds.
execution risk
guidewire migration updates
A smooth rollout is boring, which is good. Cost overruns or timing slips would show up later in expenses, not in a press release headline.
income
next $0.1825 dividend declaration
The payout matters because yield is a large part of your return case here. If operations stay flat, consistency becomes the product.
Analyst rankings
earnings predictability
25 / 100
Low predictability means results can swing more than you want. In human-speak, analysts do not trust this earnings stream to land smoothly every quarter.
balance sheet grade
B+
A B+ balance sheet means functional staying power. You are not buying a distressed insurer, but you are not buying a fortress either.
valuation
7.8x p/e
That multiple is cheap by market standards. Plain English: the market is paying you to tolerate slow shrinkage, not rewarding you for future upside yet.
source: institutional data
Institutional activity
institutional ownership data for DGICB is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$18
current price
n/a
target midpoint · n/a from current
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