Value
9.8/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 9.9 |
| P/S | 9.8 |
| EV/EBITDA | 10.0 |
| Fwd P/E | 9.5 |
| PEG | 10.0 |
- ▸Forward P/E: 8.2x
- ▸PEG: 0.27
- ▸Attractively valued
UVE · Why this verdict
Why UNIVERSAL INSURANCE HOLDINGS IN (UVE) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictHOLD
Overall score6.4/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Universal Insurance Holdings carries a perfect 4-quarter earnings beat streak and an attractive valuation with strong ROE, but the stock has already reached its price target with negative asymmetry, alongside notable insider selling and an elevated put/call ratio near its 52-week high.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The put/call ratio stands at an elevated 1.75, indicating options markets are pricing increased downside hedging or bearish positioning even as the stock trades near its 52-week high. Key risks | The put/call ratio should normalize below 1.0 over the next 12 months if downside hedging pressure eases. | ↓Deteriorating |
| CounterAn elevated put/call ratio near a 52-week high can also reflect protective hedging by long holders locking in gains rather than a genuinely bearish signal. | ||
The company has beaten earnings estimates in all of the last 4 quarters with an average surprise of 114.5%, and the engine flags the earnings report in 19 days as a catalyst edge given this perfect beat streak. Edge rationale | The company should beat or meet estimates again at the July 23 earnings report to extend the streak to 5 of 5. | ↓Deteriorating |
| CounterA beat streak this large in magnitude (up to 334% surprise in one quarter) can reflect conservative guidance that eventually gets priced in, reducing the surprise's market impact even if the streak continues. | ||
The stock combines an attractive valuation (forward P/E of 9.8x, PEG of 0.32) with excellent profitability, including a 39% ROE and 173% free-cash-flow-to-net-income conversion. Quality breakdown | ROE should stay above 25% and the forward P/E should remain below 12x over the next 12 months to sustain the attractive-valuation-plus-quality combination. | ↓Deteriorating |
| CounterInsurance-sector ROE can be inflated by favorable reserve releases or catastrophe-light periods that reverse sharply after a major loss event. | ||
The stock has already reached its analyst price target with only 0.2% upside to the take-profit level, and the engine's asymmetry gate failed at a ratio of -0.87, with downside risk of 6.3% now exceeding the remaining upside. Engine gate (failed) | A new take-profit level above the current $43.08 resistance should emerge to restore positive asymmetry over the next 12 months. | ↓Deteriorating |
| CounterA perfect 4-quarter earnings beat streak could force analysts to raise price targets well above the current level, resolving the negative asymmetry. | ||
Insiders have sold $2,628,139 of stock over the last 90 days across 8 separate transactions, rated as moderate-severity selling equal to 0.219% of market cap. Insider | Insider selling should not escalate beyond 0.219% of market cap over the next 12 months and net insider activity should turn neutral or positive. | →Stable |
| CounterMultiple smaller sales across 8 transactions with no C-level participation can reflect routine diversification rather than a negative signal about the business. | ||
The put/call ratio stands at an elevated 1.75, indicating options markets are pricing increased downside hedging or bearish positioning even as the stock trades near its 52-week high.
↓DeterioratingKey risks
- Expectation
- The put/call ratio should normalize below 1.0 over the next 12 months if downside hedging pressure eases.
CounterAn elevated put/call ratio near a 52-week high can also reflect protective hedging by long holders locking in gains rather than a genuinely bearish signal.
The company has beaten earnings estimates in all of the last 4 quarters with an average surprise of 114.5%, and the engine flags the earnings report in 19 days as a catalyst edge given this perfect beat streak.
↓DeterioratingEdge rationale
- Expectation
- The company should beat or meet estimates again at the July 23 earnings report to extend the streak to 5 of 5.
CounterA beat streak this large in magnitude (up to 334% surprise in one quarter) can reflect conservative guidance that eventually gets priced in, reducing the surprise's market impact even if the streak continues.
The stock combines an attractive valuation (forward P/E of 9.8x, PEG of 0.32) with excellent profitability, including a 39% ROE and 173% free-cash-flow-to-net-income conversion.
↓DeterioratingQuality breakdown
- Expectation
- ROE should stay above 25% and the forward P/E should remain below 12x over the next 12 months to sustain the attractive-valuation-plus-quality combination.
CounterInsurance-sector ROE can be inflated by favorable reserve releases or catastrophe-light periods that reverse sharply after a major loss event.
The stock has already reached its analyst price target with only 0.2% upside to the take-profit level, and the engine's asymmetry gate failed at a ratio of -0.87, with downside risk of 6.3% now exceeding the remaining upside.
↓DeterioratingEngine gate (failed)
- Expectation
- A new take-profit level above the current $43.08 resistance should emerge to restore positive asymmetry over the next 12 months.
CounterA perfect 4-quarter earnings beat streak could force analysts to raise price targets well above the current level, resolving the negative asymmetry.
Insiders have sold $2,628,139 of stock over the last 90 days across 8 separate transactions, rated as moderate-severity selling equal to 0.219% of market cap.
→StableInsider
- Expectation
- Insider selling should not escalate beyond 0.219% of market cap over the next 12 months and net insider activity should turn neutral or positive.
CounterMultiple smaller sales across 8 transactions with no C-level participation can reflect routine diversification rather than a negative signal about the business.
Per-dimension breakdown
Quality
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 4.2 |
| Gross margin | 1.3 |
| Op margin | 6.6 |
| Net margin | 7.0 |
| Current ratio | 2.1 |
| Moat | 6.9 |
| Piotroski F | 6.7 |
- ▸Excellent ROE: 41%
Growth
6.5/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.9 |
| EPS growth | 8.1 |
Momentum
3.8/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 2.5 |
| OBV | 1.0 |
| MA position | 6.0 |
| Volume | 3.8 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.2 |
| Analyst rating | 5.0 |
| Price target | 6.6 |
Insider
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 6.9 |
| notable moves | 7.0 |
- ▸Notable insider selling — $1,764,926 (0.138% of mkt cap)
Peer rank
7.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 8.7 |
| quality rank | 7.4 |
| growth rank | 5.6 |
- ▸Attractive P/E vs peers
- ▸Superior ROE vs peers
Technical
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 5.6 |
| support resistance | 5.3 |
| 52w position | 8.1 |
Risk (lower is worse)
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.1 |
| days to cover | 5.8 |
| volatility | 4.5 |
| put call | 8.7 |
| implied vol | 2.2 |
| beta | 8.8 |
| debt equity | 9.4 |
| news risk | 6.0 |
- ▸High IV: 67%
Catalyst
7.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 3.5 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 5.5 |
| news activity | 8.0 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_BOOST:ANALYST:0.40
- EARNINGS_PROXIMITY:119d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:3.8<4.5
- ASYMMETRY:-0.6=NEGATIVE
Warning (0)
none
Reward-to-Risk
-0.63
Upside
-5.7%
Downside
9.1%
Sizing output
AVOID
SetupRange Bound — RSI 44 mid-range, Bollinger mid-band
EdgeInst Constrain — Small cap ($1.3B) below institutional reach
SuitabilitySpeculative — Binary industry: Insurance - Property & Casualty
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: INSIDER:OK. Top dim: Value at 9.8; weakest: Momentum at 3.8. No conviction either direction.
The strongest dimensions are Value at 9.8, Peer rank at 7.2, and Catalyst at 7.0; the weakest are Momentum at 3.8, Insider at 4.7, and Quality at 5.6. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of -0.63 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Perfect Earnings Beat Streak Catalyst
Trip ifEarnings surprise turns negative, falling below 0% at the next report.
- P2Attractive Valuation Strong Returns
Trip ifROE falls below 20% from the current 39%.
- P3Target Reached Negative Asymmetry
Trip ifTake-profit level rises above $48 from the current $43.08.
- P4Notable Insider Selling
Trip ifInsider selling as a percentage of market cap falls below 0.1% from the current 0.219%.
- P5Elevated Put Call Hedging
Trip ifPut/call ratio falls below 1.0 from the current 1.75.