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Markel Corp (MKL)
NYSE:MKL
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Markel
(NYSE:MKL)
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Rating:73Outperform
Price Target:
$2,144.00
▲(11.49% Upside)
Markel's overall stock score is driven by its strong financial performance and attractive valuation, despite technical indicators suggesting potential bearish momentum. The company's strategic initiatives and restructuring efforts are positive, but challenges in the insurance segment and incomplete cash flow data introduce some uncertainty.
Markel (MKL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$24.33B
Dividend YieldN/A
Average Volume (3M)40.26K
Price to Earnings (P/E)11.5
Beta (1Y)0.47
Revenue Growth1.66%
EPS Growth8.51%
CountryUS
Employees22,000
SectorFinancial
Sector Strength70
IndustryInsurance - Property & Casualty
Share Statistics
EPS (TTM)25.61
Shares Outstanding12,652,001
10 Day Avg. Volume41,796
30 Day Avg. Volume40,264
Financial Highlights & Ratios
PEG Ratio0.23
Price to Book (P/B)1.33
Price to Sales (P/S)1.34
P/FCF Ratio9.61
Enterprise Value/Market Cap1.25
Enterprise Value/Revenue1.87
Enterprise Value/Gross Profit2.71
Enterprise Value/Ebitda9.05
Forecast
1Y Price Target
$1,993.33Price Target Upside3.65% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
Markel Business Overview & Revenue Model
Company DescriptionMarkel Corporation, a diverse financial holding company, markets and underwrites specialty insurance products in the United States, Bermuda, the United Kingdom, rest of Europe, Canada, the Asia Pacific, and the Middle East. Its Insurance segment offers general and professional liability, personal lines, marine and energy, specialty programs, and workers' compensation insurance products; and property coverages that include fire, allied lines, and other specialized property coverages, including catastrophe-exposed property risks, such as earthquake and wind. This segment also offers credit and surety products, and collateral protection insurance products. The company's Reinsurance segment offers transaction, healthcare, and environmental impairment liability; and specialty treaty reinsurance products comprising structured and whole turnover credit, political risk, mortgage and contract, and commercial surety reinsurance programs. Its Markel Ventures segment provides equipment used in baking systems and food processing; portable dredges; over-the-road car haulers and transportation equipment; and laminated oak and composite wood flooring, tube and tank trailers, as well as ornamental plants and residential homes, handbags, and architectural products. This segment also provides consulting, and other types of services to businesses and consumers, including distribution of exterior building products, crane rental, fire protection, and life safety services, management and technology consulting, and retail intelligence services. The company's Other segment provides healthcare, leasing and investment services, as well as operates as an insurance and investment fund manager offering a range of investment products, including insurance-linked securities, catastrophe bonds, insurance swaps, and weather derivatives; and program services. it also manages funds with third parties. Markel Corporation was founded in 1930 and is based in Glen Allen, Virginia.
How the Company Makes MoneyMarkel generates revenue primarily through its insurance and reinsurance operations, where it earns premium income from policyholders. This income is supplemented by investment revenue derived from its diversified investment portfolio, which includes equities, fixed income, and alternative investments. Key revenue streams include underwriting premiums collected from various specialty insurance products, as well as income from the investment of those premiums until claims are paid. Additionally, Markel benefits from its strong relationships with brokers and agents, which help in acquiring a steady flow of business. The company's disciplined underwriting practices and risk selection processes play a crucial role in maintaining profitability, while its investment strategy seeks to maximize returns on the capital held for future claims.
Markel Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 04, 2025
Earnings Call Sentiment Neutral
The call highlighted significant growth in the Ventures and Investments segments and favorable reserve developments, alongside strategic restructuring of the insurance segment for future efficiency. However, the insurance segment faced challenges with adverse developments in discontinued lines and a rising expense ratio.Q2-2025 Updates
Positive Updates
Ventures and Investments Growth
Markel Ventures revenues grew to $2.7 billion year-to-date compared to $2.6 billion previously, with operating income increasing to $310 million from $281 million. Investments operating income was $822 million for the second quarter of 2025 compared to $100 million the previous year.
Favorable Reserve Development
Markel Insurance reported 6 points of overall favorable reserve development for the first half of the year, continuing a streak of over 20 years of favorable reserve development.
Equity Portfolio Gains
The equity portfolio returned 5.4% in the second quarter, contributing $597 million in mark-to-market gains.
Restructuring for Efficiency
Significant reorganization of Markel Insurance into three core divisions, aiming to align financial reporting and empower leaders with clearer accountability.
Negative Updates
Insurance Segment Challenges
The Markel Insurance combined ratio was 96.9%, up from 93.8% a year ago, influenced by adverse development in discontinued product lines and a higher expense ratio.
Risk-Managed D&O Losses
U.S. and European risk-managed D&O professional liability lines added $127 million of losses in the quarter, impacting the combined ratio by 6 points.
Global Reinsurance Adverse Development
Adverse development within the Global Reinsurance division added $50 million to losses, contributing over 2 points to the combined ratio.
Expense Ratio Concerns
The expense ratio increased to 36.3% from 34.5% in the comparable period, with increases in controllable expenses and professional fees.
Company Guidance
During the Markel Group's second-quarter 2025 conference call, significant guidance was provided on various metrics and strategic initiatives. The company reported a consolidated operating income of $1.1 billion, driven largely by changes in unrealized gains on the equity portfolio. Markel Ventures saw a 7% increase in revenues and a 17% rise in operating income, reaching $208 million. The company's net investment income stood at $228 million, with a fixed-income book yield of 3.5% and a short-term investments yield of 3.9%. Markel's insurance segment, now restructured into four divisions, faced challenges, resulting in a combined ratio of 96.9%, impacted by adverse developments, particularly in discontinued lines. Despite these challenges, the company emphasized its long-term strategy to improve profitability and enhance financial transparency, highlighted by actions like placing the Global Reinsurance division into runoff. The company also reported that Markel Insurance achieved a favorable reserve development of 6 points in the first half of 2025. Looking ahead, Markel aims to focus on its core strengths, enhance operational efficiency, and maintain its practice of setting reserves conservatively, with a record of over 20 years of favorable reserve development.Markel Financial Statement Overview
Summary
Markel exhibits strong revenue growth and profitability with a solid equity position and low leverage. However, incomplete cash flow data for 2024 introduces some uncertainty, particularly in cash management.Income Statement
Markel has shown strong revenue growth over the years, with a significant jump in total revenue from $15.8 billion in 2023 to $16.6 billion in 2024. The gross profit margin remains robust, indicating efficient cost management. The net profit margin has improved from 12.6% in 2023 to 26.6% in 2024, reflecting better profitability. EBIT and EBITDA margins are also strong, underscoring operational efficiency. However, fluctuations in EBIT in earlier years highlight potential volatility.85
Very Positive
Balance Sheet
Markel's balance sheet reflects a solid equity position with stockholders' equity increasing to $17.7 billion in 2024. The debt-to-equity ratio is low, indicating prudent financial leverage. ROE has improved significantly, showcasing enhanced profitability for shareholders. However, the absence of total assets data in 2024 restricts a comprehensive analysis of the equity ratio.78
Positive
Cash Flow
While Markel has historically maintained positive free cash flow, the absence of detailed cash flow data for 2024 limits a thorough analysis. The company demonstrated a strong operating cash flow to net income ratio in prior years, indicating good cash generation capability. However, fluctuations in free cash flow growth rates suggest potential volatility in cash management.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 16.26B | 16.75B | 15.71B | 11.81B | 12.92B | 9.64B |
| Gross Profit | 11.18B | 11.70B | 10.39B | 5.71B | 7.92B | 4.94B |
| EBITDA | 3.35B | 4.18B | 3.16B | 353.94M | 3.65B | 1.49B |
| Net Income | 2.23B | 2.75B | 2.00B | -216.28M | 2.42B | 816.03M |
Balance Sheet | ||||||
| Total Assets | 66.79B | 61.90B | 55.05B | 63.44B | 48.48B | 41.71B |
| Cash, Cash Equivalents and Short-Term Investments | 21.07B | 10.56B | 10.21B | 18.66B | 18.37B | 17.06B |
| Total Debt | 0.00 | 4.33B | 3.78B | 4.10B | 4.36B | 3.48B |
| Total Liabilities | 48.92B | 44.43B | 39.52B | 25.54B | 24.18B | 21.21B |
| Stockholders Equity | 17.32B | 16.92B | 14.98B | 13.07B | 14.70B | 12.80B |
Cash Flow | ||||||
| Free Cash Flow | 2.05B | 2.34B | 2.53B | 2.45B | 2.13B | 1.64B |
| Operating Cash Flow | 2.27B | 2.59B | 2.79B | 2.71B | 2.27B | 1.74B |
| Investing Cash Flow | -756.93M | -2.40B | -2.70B | -1.67B | -2.94B | -511.75M |
| Financing Cash Flow | -1.48B | -297.88M | -999.72M | -595.31M | 369.77M | 434.56M |
Markel Technical Analysis
Negative
1923.06
Price Trends
1961.16
Negative
1946.12
Negative
1876.74
Positive
Market Momentum
-7.47
Positive
45.13
Neutral
44.57
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MKL, the sentiment is Negative. The current price of 1923.06 is below the 20-day moving average (MA) of 1941.75, below the 50-day MA of 1961.16, and above the 200-day MA of 1876.74, indicating a neutral trend. The MACD of -7.47 indicates Positive momentum. The RSI at 45.13 is Neutral, neither overbought nor oversold. The STOCH value of 44.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MKL.
Markel Risk Analysis
Markel disclosed 26 risk factors in its most recent earnings report. Markel reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Markel Peers Comparison
Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | 11.87B | 15.50 | 16.92% | 6.47% | 3.35% | -14.16% | |
78 Outperform | 24.19B | 13.54 | 12.73% | 2.21% | 9.64% | -15.08% | |
77 Outperform | 27.84B | 16.70 | 18.94% | 1.83% | 11.41% | 15.32% | |
73 Outperform | $24.33B | 11.53 | 13.23% | ― | 1.66% | 8.51% | |
66 Neutral | 12.45B | 14.14 | 8.23% | 8.30% | 6.12% | -31.43% | |
66 Neutral | 20.17B | 15.37 | 8.29% | 0.26% | 8.27% | -7.92% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
Performance Comparison
MKL
Markel
1,923.06
350.79
22.31%
AFG
American Financial Group
142.30
14.52
11.36%
CINF
Cincinnati Financial
154.69
21.59
16.22%
CNA
CNA Financial
46.00
0.02
0.04%
L
Loews
97.24
18.79
23.95%
WRB
W. R. Berkley Corporation
73.41
17.11
30.39%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.