MKL Stock Trading at a Discount to Industry at 1.53X: Time to Hold?
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Shares of Markel Group have surged 26.7% in the past year, outperforming its industry, and the Finance sector and the Zacks S&P 500 composite's growth of 6.1%, 18.2% and 11.8%, respectively.Markel Group has outperformed its peers, ITT Inc. ITT and Honeywell International Inc. HON, which have risen 19.1% and 10.2%, respectively, in the past year. Meanwhile, shares of Carlisle Companies Incorporated CSL have lost 2.4% in the past year.
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Shares of Markel Group are trading above the 50-day and 200-day simple moving averages (SMAs) of $1,927.94 and $21,788.82, indicating solid upward momentum. SMA is a widely used technical analysis tool to predict future price trends by analyzing historical price data. Its share price as of July 10, 2025, was $1,994.16, down 3.3% from its 52-week high of $2,063.68.
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The Zacks Consensus Estimate for Markel Group's 2025 earnings per share indicates a year-over-year increase of 18.1%. The consensus estimate for revenues is pegged at $15.21 billion, implying a year-over-year improvement of 2.6%. The consensus estimate for 2026 earnings per share and revenues implies an increase of 11.5% and 6.3%, respectively, from the corresponding 2025 estimates.Earnings have grown 23.1% in the past five years, better than the industry average of 15.6%.
One of the four analysts covering the stock hasve raised estimates for 2025, while one of the five analysts has lowered the same for 2026 over the past 30 days. Thus, the Zacks Consensus Estimate for 2025 and 2026 earnings has moved up 0.5% and 0.4%, respectively, in the past 30 days.
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Return on equity in the trailing 12 months was 7.48%, underperforming the industry average of 36.59%. Return on equity, a profitability measure, reflects how effectively a company is utilizing its shareholders' funds. Thus, MKL's ROE is lagging the industry average.
MKL has been generating improved premiums. An improvement in new business volume, strong retention levels, continued increases in rates and expanded product offerings should help the insurer retain the momentum.Investment income should continue to benefit from an improving rate environment, higher interest income on cash equivalents, fixed maturity securities and short-term investments due to higher yields.Markel Group considers strategic buyouts a prudent approach to ramp up its growth profile. Acquisitions have helped the company enhance its surety capabilities, ramp up Markel Ventures' revenues and expand its reinsurance product offerings. The insurer has been pursuing acquisitions to achieve profitable growth in insurance operations and create additional value on a diversified basis in Markel Ventures' operations.Higher revenues at construction services and transportation-related businesses due to a combination of increased demand, higher prices and growth, as well as a rise in production at one of the equipment manufacturing businesses, are expected to boost operating revenues. The increase also reflected a full-year contribution from Metromont.
Banking on a strong capital position, the company engages in share buybacks, a prudent way to distribute wealth to its shareholders. MKL has a share repurchase program, authorized by the board, that provides for the repurchase of up to $2 billion of shares. Also, given its solid cash position of $4.2 billion, the company should not face any difficulty in meeting short-term obligations.
Given the company's strong stock performance, solid retention levels, an improving rate environment, favorable growth estimates and solid capital position, current shareholders may find it wise to hold onto MKL shares. Markel Group's new business volume and prudent capital deployment present significant growth opportunities. MKL also has a VGM Score of A. Stocks with a favorable VGM Score are those with the most attractive value, best growth and most promising momentum compared with peers.Given Markel Group's unfavorable return on capital and the mixed analyst sentiments surrounding the company, it is better to adopt a wait-and-see approach on this Zacks Rank #3 (Hold) stock. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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