Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, homeowners insurance specialist Universal Insurance Holdings (NYSE: UVE ) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Universal's business and see what CAPS investors are saying about the stock right now.
Universal facts
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Headquarters (founded)
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Fort Lauderdale, Fla. (1990)
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Market Cap
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$202.1 million
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Industry
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Property and casualty insurance
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Trailing-12-Month Revenue
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$226.8 million
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Management
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CEO Bradley Meier (since 1990)
CFO George De Heer (since 2010)
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Return on Equity (average, past 3 years)
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36.2%
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Cash/Debt
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$399.3 million / $48.3 million
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Dividend Yield
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8%
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Competitors
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Allstate (NYSE: ALL )
Chubb (NYSE: CB )
Travelers Cos. (NYSE: TRV )
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Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 97% of the 589 members who have rated Universal believe the stock will outperform the S&P 500 going forward. These bulls include All-Star bigsmitty52, who is ranked in the top 1% of our community, and JMRiv1986.
Just last week, bigsmitty52 tapped Universal as an attractive income opportunity:
Look at the yield on this stock. If all it does is sit around and pay its dividend for the next five years, I will be a happy man. It will probably rise very slowly, as real estate in Florida begins to increase.
Universal's solid balance sheet and juicy dividend yield continue to support its five-star CAPS status. In addition to sporting a yield of 8%, Universal trades at a clear price-to-cash flow (2.2) discount to homeowners insurance providers Allstate (4.5), Chubb (7.6), and Travelers (7.9), as well as other highly rated insurance stocks like Berkshire Hathaway (NYSE: BRK-B ) (10.9) and Markel (NYSE: MKL ) (16.3).
CAPS member JMRiv1986 elaborates on the bull case:
Huge dividend. Very good value. ... Growing to other states which makes it less likely to be as greatly [affected] by hurricanes in Florida. Insider ownership of 46%. Like bigsmitty52 said in his assessment though as long as this stock continues to pay its huge dividend I will be happy. Any appreciation in price will be a bonus.
What do you think about Universal, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
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