Amerisafe (AMSF) AI Stock Analysis

• Market Cap: $758.49M
• Dividend Yield: 11.37%
• Average Volume (3M): 130.89K
• Price to Earnings (P/E): 15.3
• Beta (1Y): 0.24
• Revenue Growth: -1.73%
• EPS Growth: -18.36%
• Country: US
• Employees: 362
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Specialty
• EPS (TTM): 0.55
• Shares Outstanding: 18,924,398
• 10 Day Avg. Volume: 124,388
• 30 Day Avg. Volume: 130,892
• PEG Ratio: -1.74
• Price to Book (P/B): 3.82
• Price to Sales (P/S): 3.18
• P/FCF Ratio: 42.10
• Enterprise Value/Market Cap: 1.10
• Enterprise Value/Revenue: 2.70
• Enterprise Value/Gross Profit: 3.37
• Enterprise Value/Ebitda: 18.13
• 1Y Price Target: $52.50
• Price Target Upside: 30.99% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 72 Outperform
• Price Target: ―

Amerisafe's stock score reflects a solid financial foundation with zero debt and a strong equity position, though it faces challenges in profitability and cash flow growth. Technical indicators show a bearish trend, impacting near-term sentiment. Valuation metrics are fair, and the earnings call highlights both operational strengths and financial challenges.

Positive Factors

Financial Stability

Amerisafe's zero-debt position enhances its financial flexibility and stability, allowing it to navigate economic uncertainties without the burden of interest obligations.

Gross Written Premiums Growth

Growth in gross written premiums suggests effective market penetration and demand for Amerisafe's insurance products, supporting long-term revenue growth.

Policy Retention

High policy retention rates indicate strong customer loyalty and satisfaction, which can lead to sustained revenue streams and reduced costs associated with acquiring new customers.

Negative Factors

Cash Flow Decline

A decline in free cash flow indicates challenges in cash generation, which could hinder Amerisafe's capacity to fund operations and growth without external financing.

Increased Expenses

Rising expenses can pressure profit margins and reduce financial efficiency, potentially limiting Amerisafe's ability to invest in strategic growth areas.

Decreased Net Income

The significant drop in net income reflects challenges in profitability, which could impact the company's ability to reinvest in growth initiatives and maintain competitive positioning.

Amerisafe Business Overview & Revenue Model

Company Description

AMERISAFE, Inc., an insurance holding company, underwrites workers' compensation insurance in the United States. The company's workers' compensation insurance policies provide benefits to injured employees for temporary or permanent disability, death, and medical and hospital expenses. It serves small to mid-sized employers engaged in hazardous industries, including construction, trucking, logging and lumber, agriculture, manufacturing, telecommunications, and maritime. The company was incorporated in 1985 and is based in DeRidder, Louisiana.

How the Company Makes Money

Amerisafe generates revenue primarily through underwriting workers' compensation insurance policies. The company's key revenue stream is the collection of premiums from policyholders, which are calculated based on the level of risk associated with the insured's industry and the size of their workforce. Amerisafe's profitability is influenced by its ability to accurately assess risks, set appropriate premium rates, and manage claims efficiently. The company also earns investment income from its portfolio, which consists of premiums collected and held in reserve to pay future claims. Strategic partnerships with independent insurance agencies and brokers help Amerisafe expand its market reach and maintain a steady flow of new business.

Amerisafe Financial Statement Overview

Summary

Amerisafe demonstrates strong financial stability with zero debt and a healthy equity position, but faces challenges in maintaining profitability margins and cash flow growth. The company is well-positioned in terms of financial health but could benefit from strategies to boost revenue growth and cash flow efficiency.

Income Statement

Amerisafe's income statement shows a stable revenue base with a gross profit margin of approximately 89.8% in 2024. However, the net profit margin decreased from 20.2% in 2023 to 17.9% in 2024, indicating a slight decline in profitability. The company experienced a modest revenue growth rate of 0.7% from 2023 to 2024, which suggests stability but limited growth potential. EBIT and EBITDA margins are unavailable for 2024, affecting the assessment of operational efficiency.

Balance Sheet

The balance sheet reflects a strong equity position with zero total debt in 2024, resulting in a debt-to-equity ratio of 0, which is excellent for financial stability. The return on equity (ROE) decreased to 21.5% in 2024 from 21.2% in 2023, but remains robust. The equity ratio is 22.2% in 2024, showing a consistent reliance on equity financing. The absence of debt enhances financial flexibility.

Cash Flow

Cash flow analysis indicates a decrease in free cash flow from $29.3M in 2023 to $23.3M in 2024, resulting in a negative free cash flow growth rate of -20.2%. The operating cash flow to net income ratio is 0.44 in 2024, highlighting a need for improved cash generation relative to profits. The free cash flow to net income ratio stands at 0.42, suggesting that cash management strategies could be optimized.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	309.71M	309.04M	306.91M	294.69M	316.01M	339.50M
Gross Profit	248.14M	277.54M	306.91M	142.38M	155.22M	339.50M
EBITDA	46.12M	70.15M	0.00	68.95M	80.47M	106.92M
Net Income	49.92M	55.44M	62.11M	55.60M	65.76M	86.60M
Balance Sheet
Total Assets	222.63M	1.16B	1.23B	1.27B	1.40B	1.47B
Cash, Cash Equivalents and Short-Term Investments	54.75M	351.80M	355.75M	396.71M	70.72M	61.76M
Total Debt	0.00	428.00K	267.00K	336.00K	395.00K	499.00K
Total Liabilities	-942.32M	900.45M	936.71M	951.85M	1.00B	1.03B
Stockholders Equity	1.16B	257.34M	292.45M	317.43M	399.32M	438.82M
Cash Flow
Free Cash Flow	9.29M	23.35M	29.29M	26.11M	36.68M	62.48M
Operating Cash Flow	11.27M	24.19M	29.84M	28.19M	37.98M	63.40M
Investing Cash Flow	71.44M	72.37M	43.88M	75.43M	70.96M	43.37M
Financing Cash Flow	-91.63M	-91.20M	-96.51M	-112.87M	-99.97M	-88.83M

Amerisafe Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 40.08
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMSF, the sentiment is Negative. The current price of 40.08 is below the 20-day moving average (MA) of 41.24, below the 50-day MA of 43.23, and below the 200-day MA of 46.06, indicating a bearish trend. The MACD of -0.80 indicates Positive momentum. The RSI at 35.90 is Neutral, neither overbought nor oversold. The STOCH value of 20.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AMSF.

Amerisafe Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EIG	―	$896.50M	15.01	5.86%	3.04%	1.69%	-52.43%
AMSF	―	$758.49M	15.35	16.95%	11.37%	-1.73%	-18.36%
Sector *	―	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
TIPT	―	$664.13M	13.66	10.46%	2.77%	4.44%	22.40%
HIPO	―	$923.03M	-87.54	-3.27%	―	43.15%	94.09%
JRVR	―	$234.20M	―	-13.01%	0.78%	-20.88%	1.34%
AMBC	―	$380.96M	―	-4.09%	―	-17.06%	-118.90%