(DGICA) Donegal - Ratings and Ratios

Donegal Group Inc. (NASDAQ:DGICA) operates as a property and casualty insurance holding company, specializing in underwriting insurance products for both personal and commercial clients. The company is structured into three core segments: Investment Function, Personal Lines of Insurance, and Commercial Lines of Insurance. Its personal lines segment offers private passenger automobile policies that cover liability for bodily injury and property damage, along with protection against damage to insured vehicles. Homeowners policies provide coverage for damage to residences and contents from perils like fire, windstorms, and theft, as well as liability coverage for injuries or property damage to third parties. Commercial lines include policies for commercial vehicles, multi-peril coverage for businesses (combining liability and physical damage), and workers compensation insurance, which provides benefits to employees for workplace injuries. The company distributes its products through a network of independent insurance agencies, focusing on regions such as the Mid-Atlantic, Midwest, New England, Southern, and Southwestern United States. Donegal Group Inc. was established in 1986 and is headquartered in Marietta, Pennsylvania, functioning as a subsidiary of Donegal Mutual Insurance Company.

From a technical perspective, DGICA is trading above its 20-day and 50-day simple moving averages (SMA) but below its 200-day SMA, indicating short-term momentum but longer-term resistance. The stocks average true range (ATR) of 0.39 reflects relatively stable volatility. On the fundamental side, the companys forward P/E ratio of 12.64 suggests expectations of earnings growth, while its price-to-book (P/B) ratio of 1.00 indicates that the stock is valued at its book value. The price-to-sales (P/S) ratio of 0.53 points to modest valuation relative to revenue, and a return on equity (RoE) of 4.85% highlights moderate profitability. Over the next three months, DGICA is likely to experience continued support from its defensive insurance sector positioning, with potential upside driven by improving underwriting margins and stable investment income. However, the stock may face headwinds from rising interest rates and competitive market conditions in the property and casualty insurance space. The 20-day SMA of 15.41 and 50-day SMA of 15.11 suggest near-term support levels, while the 200-day SMA of 14.36 could act as a floor if broader market sentiment weakens.