Detailed financial statements for The Hanover Insurance Group, Inc. (THG): income statement, balance sheet and cash-flow summary. Track margins, debt, liquidity and profitability trends year over year: ten fiscal years free and up to 20 with Premium.
The Hanover Insurance Group, Inc. (THG) is a U.S.-based insurer offering a wide array of property and casualty coverage through its various operating units. Its operations are organized into three main divisions: Commercial Lines, Personal Lines, and an "Other" segment. The Commercial Lines division delivers a comprehensive suite of business insurance solutions, including multi-peril, commercial auto, and workers' compensation policies.
Analysis Summary
The Hanover Insurance Group, Inc. reported revenue of $6.60B in the most recent fiscal year, growing at a 5-year CAGR of 6.5%. Net income reached $662.5M, with a 13.1% 5-year CAGR.
Trailing-twelve-month margins: gross margin 39.9%, operating margin 14.3%, net margin 11.2%. Free cash flow grew at 11.1% CAGR over 5 years.
At the current price of $220.40, THG trades at a P/E of 10.34 and an ROE of 21.22%. Market capitalisation stands at $7.7B.
Balance sheet quality for THG: current ratio of 0.6, net cash position of $1.78B. A debt-to-equity below 1.0 typically signals conservative capital structure, while a current ratio above 1.5 indicates comfortable short-term liquidity.
Cash flow quality is strong: free cash flow of $1.17B represents 177% conversion of reported net income. High conversion (above 90%) suggests earnings translate cleanly into cash; lower conversion may indicate working capital tightness or accounting timing differences.
Income Statement (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $3.97B | $4.27B | $4.47B | $4.89B | $4.82B | $5.16B | $5.43B | $5.96B | $6.22B | $6.60B |
| Cost of Revenue | $3.35B | $3.42B | $3.62B | $3.79B | $3.80B | $4.12B | $4.72B | $5.31B | $4.98B | $3.73B |
| Gross Profit | $616.0M | $847.6M | $849.7M | $1.10B | $1.02B | $1.04B | $716.3M | $652.9M | $1.24B | $2.87B |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Selling, General & Admin | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Operating Expenses | $550.0M | $554.7M | $567.2M | $576.4M | $577.6M | $521.4M | $572.3M | $611.8M | $699.9M | $2.02B |
| Operating Income | $66.0M | $292.9M | $282.5M | $522.1M | $444.8M | $521.3M | $144.0M | $41.1M | $537.8M | $843.8M |
| EBITDA | $148.1M | $368.2M | $352.2M | $581.2M | $500.1M | $572.2M | $191.0M | $81.5M | $573.4M | $882.4M |
| Interest Expense | $51.4M | $45.2M | $45.1M | $37.5M | $37.1M | $34.0M | $34.1M | $34.1M | $34.1M | $43.2M |
| Pre-tax Income | $66.0M | $292.9M | $282.5M | $522.1M | $444.8M | $521.3M | $144.0M | $41.1M | $537.8M | $843.8M |
| Income Tax | -$1.0M | $76.8M | $43.5M | $93.1M | $82.8M | $101.3M | $27.2M | $7.6M | $112.5M | $183.1M |
| Net Income | $155.1M | $186.2M | $391.0M | $425.1M | $358.7M | $422.8M | $116.0M | $35.3M | $426.0M | $662.5M |
| EPS | $3.63 | $4.38 | $9.24 | $11.07 | $9.51 | $11.79 | $3.21 | $0.98 | $11.85 | $18.51 |
| EPS (Diluted) | $3.59 | $4.33 | $9.09 | $10.46 | $9.42 | $11.49 | $3.21 | $0.98 | $11.70 | $18.51 |
| Shares Outstanding (Diluted) | $43.2M | $43.0M | $43.0M | $40.6M | $38.1M | $36.4M | $36.1M | $36.1M | $36.4M | $35.7M |
Income Statement (Quarterly)
| Year | 2025-Q3 | 2025-Q4 | 2026-Q1 | 2026-Q2 |
|---|---|---|---|---|
| Revenue | $1.66B | $1.67B | $1.70B | $1.73B |
| Gross Profit | $406.2M | $782.2M | $743.8M | $763.7M |
| Operating Income | $227.1M | $257.8M | $237.1M | $244.6M |
| EBITDA | $237.5M | $271.0M | $246.1M | $253.7M |
| Net Income | $178.7M | $198.5M | $186.8M | $191.6M |
| EPS | $4.98 | $5.59 | $5.26 | $5.40 |
| EPS (Diluted) | $4.91 | $5.47 | $5.15 | $5.28 |
Balance Sheet (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Cash & Equivalents | $282.6M | $376.4M | $1.02B | $215.7M | $120.6M | $230.9M | $305.0M | $316.1M | $435.5M | $1.12B |
| Short-term Investments | $7.33B | $5.75B | $6.16B | $6.69B | $7.45B | $7.72B | $7.48B | $7.99B | $1.59B | $1.87B |
| Receivables | $4.05B | $2.72B | $2.83B | $3.07B | $3.21B | $3.43B | $3.62B | $3.82B | $3.87B | $3.95B |
| Inventory | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Total Current Assets | 0 | 0 | 0 | 0 | 0 | $11.38B | $11.41B | $12.12B | $5.89B | $6.95B |
| Property, Plant & Equipment | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Goodwill | $184.8M | $192.6M | $178.8M | $178.8M | $178.8M | $178.8M | $178.8M | $178.8M | $178.8M | $178.8M |
| Intangible Assets | 0 | 0 | 0 | 0 | 0 | $552.0M | $604.8M | $620.8M | $662.8M | $703.0M |
| Total Assets | $14.22B | $15.47B | $12.40B | $12.49B | $13.44B | $14.25B | $14.00B | $14.61B | $15.27B | $16.95B |
| Accounts Payable | $251.9M | $51.5M | $37.3M | $53.4M | $48.4M | $55.1M | $70.3M | $64.3M | $37.7M | $45.2M |
| Short-term Debt | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | $61.8M | 0 |
| Total Current Liabilities | $728.0M | $344.8M | $37.3M | 0 | 0 | $55.1M | $731.7M | $6.09B | $819.6M | $11.24B |
| Long-term Debt | $786.4M | $786.9M | $777.9M | $653.4M | $780.8M | $781.6M | $782.4M | $783.2M | $722.3M | $1.22B |
| Total Liabilities | $11.36B | $12.47B | $9.45B | $9.57B | $10.24B | $11.11B | $11.66B | $12.15B | $12.43B | $13.37B |
| Retained Earnings | $1.88B | $1.98B | $2.18B | $2.41B | $2.67B | $2.98B | $2.99B | $2.91B | $3.21B | $3.74B |
| Total Equity | $2.86B | $3.00B | $2.95B | $2.92B | $3.20B | $3.14B | $2.33B | $2.47B | $2.84B | $3.57B |
| Total Debt | $786.4M | $786.9M | $777.9M | $653.4M | $780.8M | $781.6M | $782.4M | $783.2M | $784.1M | $1.22B |
| Net Debt | -$6.83B | -$5.26B | -$6.40B | -$6.25B | -$6.79B | -$7.17B | -$7.00B | -$7.52B | -$1.24B | -$1.78B |
| Working Capital | -$728.0M | -$344.8M | -$37.3M | 0 | 0 | $11.33B | $10.68B | $6.03B | $5.07B | -$4.29B |
Balance Sheet (Quarterly)
| Year | 2025-Q3 | 2025-Q4 | 2026-Q1 | 2026-Q2 |
|---|---|---|---|---|
| Cash & Equivalents | $915.7M | $1.12B | $243.5M | $266.1M |
| Total Assets | $16.77B | $16.95B | $16.53B | $16.86B |
| Total Liabilities | $13.35B | $13.37B | $12.96B | $13.19B |
| Total Equity | $3.43B | $3.57B | $3.57B | $3.67B |
| Total Debt | $1.28B | $1.22B | $843.8M | $844.0M |
Cash Flow (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Net Income | $155.1M | $186.2M | $391.0M | $425.1M | $358.7M | $420.0M | $116.0M | $35.3M | $426.0M | $662.5M |
| Depreciation & Amortization | $30.7M | $30.1M | $24.6M | $21.6M | $18.2M | $16.9M | $12.9M | $6.3M | $1.5M | -$4.6M |
| Stock-based Compensation | $12.0M | $12.3M | $13.4M | $17.4M | $20.1M | $22.9M | $29.0M | $31.1M | $31.0M | 0 |
| Change in Working Capital | $462.9M | $473.6M | $248.3M | $237.4M | $351.2M | $620.0M | $561.3M | $272.1M | $220.9M | $417.4M |
| Operating Cash Flow | $743.4M | $704.6M | $551.3M | $602.9M | $707.6M | $823.7M | $722.3M | $361.7M | $806.4M | $1.18B |
| Capital Expenditure | -$15.7M | -$18.6M | -$13.1M | -$13.3M | -$14.9M | -$8.0M | -$17.8M | -$11.9M | -$10.2M | -$7.7M |
| Acquisitions | 0 | 0 | $635.7M | $34.7M | 0 | 0 | 0 | 0 | 0 | 0 |
| Stock Repurchased | -$105.6M | -$37.2M | -$57.7M | -$563.6M | -$212.8M | -$162.6M | -$30.8M | 0 | -$26.7M | -$129.2M |
| Dividends Paid | -$80.4M | -$86.8M | -$94.3M | -$386.2M | -$99.5M | -$102.2M | -$108.9M | -$117.2M | -$124.1M | -$130.6M |
| Free Cash Flow | $721.9M | $686.0M | $538.2M | $589.6M | $692.7M | $815.7M | $704.5M | $349.8M | $796.2M | $1.17B |
Cash Flow (Quarterly)
| Year | 2025-Q3 | 2025-Q4 | 2026-Q1 | 2026-Q2 |
|---|---|---|---|---|
| Operating Cash Flow | $554.4M | $378.2M | $118.8M | $212.3M |
| Capital Expenditure | -$3.0M | -$1.2M | -$3.5M | -$2.9M |
| Free Cash Flow | $551.4M | $377.0M | $115.3M | $209.4M |
| Dividends Paid | -$32.2M | -$33.7M | -$33.5M | -$33.1M |
| Stock-based Compensation | $10.0M | 0 | $6.6M | $11.5M |
Growth & Margins (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue Growth (YoY) | +7.6% | +4.6% | +9.5% | -1.5% | +7.1% | +5.3% | +9.8% | +4.2% | +6.1% | |
| Net Income Growth (YoY) | +20.1% | +110.0% | +8.7% | -15.6% | +17.9% | -72.6% | -69.6% | +1,106.8% | +55.5% | |
| EPS Growth (YoY) | +20.7% | +111.0% | +19.8% | -14.1% | +24.0% | -72.8% | -69.5% | +1,109.2% | +56.2% | |
| Shares Change (YoY) | -0.5% | +0.0% | -5.6% | -6.2% | -4.5% | -0.8% | +0.0% | +0.8% | -1.9% | |
| FCF Growth (YoY) | -5.0% | -21.5% | +9.6% | +17.5% | +17.8% | -13.6% | -50.3% | +127.6% | +47.0% | |
| Gross Margin | 15.5% | 19.9% | 19.0% | 22.5% | 21.2% | 20.2% | 13.2% | 10.9% | 19.9% | 43.5% |
| Operating Margin | 1.7% | 6.9% | 6.3% | 10.7% | 9.2% | 10.1% | 2.7% | 0.7% | 8.7% | 12.8% |
| EBITDA Margin | 3.7% | 8.6% | 7.9% | 11.9% | 10.4% | 11.1% | 3.5% | 1.4% | 9.2% | 13.4% |
| Net Margin | 3.9% | 4.4% | 8.8% | 8.7% | 7.4% | 8.2% | 2.1% | 0.6% | 6.9% | 10.0% |
| FCF Margin | 18.2% | 16.1% | 12.1% | 12.1% | 14.4% | 15.8% | 13.0% | 5.9% | 12.8% | 17.7% |
| Effective Tax Rate | -1.5% | 26.2% | 15.4% | 17.8% | 18.6% | 19.4% | 18.9% | 18.5% | 20.9% | 21.7% |
Per-Share Data (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| FCF Per Share | $16.71 | $15.95 | $12.52 | $14.52 | $18.18 | $22.41 | $19.52 | $9.69 | $21.87 | $32.78 |
| Dividends Per Share | $1.86 | $2.02 | $2.19 | $9.51 | $2.61 | $2.81 | $3.02 | $3.25 | $3.41 | $3.66 |
| Shares Outstanding (Basic) | $42.8M | $42.5M | $42.3M | $40.0M | $37.7M | $35.9M | $35.9M | $35.7M | $35.9M | $35.7M |
What to look at in Insurance
Insurers earn in 2 ways: underwriting well (combined ratio) and investing the float. Buffett built Berkshire that way.
- Op Margin 5y (Combined Ratio proxy) — Combined ratio proxy when our data does not include it. ≥10% 5y average = underwriting discipline (CR <100%)
- Book Value / Share growth — How Buffett measures Berkshire. The real value shareholders accumulate
- Debt / Equity — Leveraged insurers fail fast under catastrophes
- P/B (Price / Book) — Insurers are valued by book multiple. Here it is crossed with ROE (quality × valuation)
- Dividend growth streak — Consecutive years raising dividend per share — solid insurers stack decades
Profitability
| Return on Equity | 21.22% |
| Return on Invested Capital | 4.47% |
| Return on Assets | 4.48% |
| Gross Margin | 39.89% |
| Operating Margin | 14.30% |
| Net Margin | 11.18% |
Financial Health
| Debt / Equity | 0.23 |
| Current Ratio | 122.53 |
| Piotroski F-Score | 7 |
| Altman Z-Score | 0.85 |
Key Ratios (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| P/E | 25.07 | 24.68 | 12.64 | 12.35 | 12.29 | 11.12 | 42.10 | 123.90 | 13.05 | 9.87 |
| P/B | 1.36 | 1.53 | 1.67 | 1.87 | 1.38 | 1.50 | 2.08 | 1.76 | 1.95 | 1.83 |
| P/S | 0.98 | 1.08 | 1.11 | 1.12 | 0.91 | 0.91 | 0.89 | 0.73 | 0.89 | 0.99 |
| Gross Margin | 15.5% | 19.9% | 19.0% | 22.5% | 21.2% | 20.2% | 13.2% | 10.9% | 19.9% | 43.5% |
| Operating Margin | 1.7% | 6.9% | 6.3% | 10.7% | 9.2% | 10.1% | 2.7% | 0.7% | 8.7% | 12.8% |
| Net Margin | 3.9% | 4.4% | 8.8% | 8.7% | 7.4% | 8.2% | 2.1% | 0.6% | 6.9% | 10.0% |
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Explore sector: Financial Services · Insurance - Property & Casualty
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