Looking Forward: PFG Focus Idea, How Should One Value an Insurtech

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Looking Forward: PFG Focus Idea, How Should One Value an Insurtech

nd hybrid platforms, making a one-size- declines in equity valuations in their investment

fits-all valuation approach unreliable. We identify two common errors: applying the portfolios and higher claim costs related to

wrong framework for the underlying business model, and assuming a blanket Insurtech inflation and changes in the legal and regulatory

environment. premium. Instead, we believe there are several appropriate ways to value an Insurtech

stock, depending on the company’s business model, profitability stage, and risk profile.

See here for full report. Insurance Brokers: The insurance brokers

industry is subject to risks including interest rate

risk, P/C underwriting cycle and competition.

• Aflac (AFL, Overweight, $61.9 billion cap): We updated our earnings model to better

account for net investment income, as well as lower premium growth in Aflac Japan. Insurtech: The Insurtech industry is subject to

Our new model aligns more closely with management commentary around long-term risks including growth, profitability, underwriting,

expectations. See here for full report. AI adaption and cybersecurity.

• Goosehead (GSHD, Overweight, $1.7 billion cap): We are maintaining our Life: Interest rates; regulatory environment;

Overweight rating on GSHD following investor meetings with management. Our secular trends across fee & risk-based

meetings largely affirmed our investment thesis: We believe investors will look forward businesses; fee pressure; FX; distribution &

to the second half of 2026 when a combination of continued new business sales efforts access to customers; pricing dynamics &

and improving customer retention should allow GSHD to accelerate its revenue growth inflationary trends.