Selective Insurance Group (SIGI) just wrapped up FY 2025 with fourth quarter revenue of US$1.36b and basic EPS of US$2.52, alongside trailing twelve month revenue of US$5.34b and EPS of US$7.48. Over recent periods, the company has seen quarterly revenue move from US$1.26b in Q4 2024 to US$1.36b in Q4 2025, with basic EPS across those same quarters shifting from US$1.52 to US$2.52. The trailing net profit margin is now 8.6% compared with 4.1% a year earlier, and earnings growth over the past year was 131.1%. With a full year combined ratio of 97.2% and a 2.05% dividend yield, the latest results point to firmer underwriting profitability that investors will weigh against the company’s longer term growth record.

See our full analysis for Selective Insurance Group.

With the numbers on the table, the next step is to see how this earnings profile lines up with the prevailing narratives around Selective Insurance Group, and where the data starts to challenge those stories.

Net Margin at 8.6% with 93.8% Combined Ratio

• For FY 2025, Selective Insurance Group reported a trailing net profit margin of 8.6% and a Q4 combined ratio of 93.8%, within a full year combined ratio of 97.2% on US$5.34b of trailing revenue.
• What stands out for a more bullish view is how underwriting and profit metrics sit together, with:
  • Q4 2025 net income of US$152.9 million and trailing twelve month net income of US$457.2 million, compared with a 103% combined ratio a year earlier on US$4.86b of trailing revenue.
  • Trailing EPS of US$7.48 versus US$3.25 a year earlier, alongside the improved combined ratio, which supports the angle that recent profitability is stronger than the longer run average.

To see how this profitability shift fits the long term story, some investors look at detailed bull and bear cases before deciding their next move. 📊 Read the full Selective Insurance Group Consensus Narrative.

Earnings Growth Snapshot Versus Longer History

• Over the last twelve months, earnings growth was 131.1%, while over the past five years trailing earnings declined by about 0.6% per year, highlighting a sharp recent change against a softer multi year trend.
• Skeptics focus on that five year record and the more modest forecasts, and the data partly backs their caution, with:
  • Forecast earnings growth of about 7.6% per year and revenue growth of about 4.9% per year, both described as below the referenced US market rates of 16.1% and 10.6% respectively.
  • This contrast between a very strong recent earnings year and slower forecast growth supports a concern that the latest year may not reflect a sustained high growth path.

P/E of 11.1x and DCF Fair Value Gap

• The shares trade at US$84.08 with a P/E of 11.1x, compared with a peer average P/E of 17.8x and a US insurance industry average P/E of 13.1x, alongside a DCF fair value of US$187.34 that is well above the current price.
• Supporters of a more optimistic stance point to this pricing alongside income, and the figures give them material talking points, with:
  • The current share price stated around 55.1% below the DCF fair value of US$187.34, while also offering a 2.05% dividend yield.
  • Net margin at 8.6% versus 4.1% a year earlier, combined with the lower P/E than peers and industry, which supports the view that the stock is priced conservatively relative to its recent profitability.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Selective Insurance Group's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

Selective Insurance Group's strong recent earnings sit alongside a softer five year earnings record and slower forecast growth compared with the wider US market.

If that mix of sharp one year results and gentler projected growth leaves you wanting steadier compounding, check out our stable growth stocks screener (2167 results) to focus on companies with more consistent earnings and revenue trajectories.

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.