Employee benefits provider Unum Group (NYSE: UNM) fell short of the market’s revenue expectations in Q4 CY2025, with sales flat year on year at $3.24 billion. Its GAAP profit of $1.04 per share was 49.3% below analysts’ consensus estimates.
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Unum Group (UNM) Q4 CY2025 Highlights:
- Net Premiums Earned: $2.69 billion vs analyst estimates of $2.71 billion (2.3% year-on-year growth, 0.8% miss)
- Revenue: $3.24 billion vs analyst estimates of $3.29 billion (flat year on year, 1.4% miss)
- Pre-tax Profit: $218.4 million (6.7% margin)
- EPS (GAAP): $1.04 vs analyst expectations of $2.05 (49.3% miss)
- Book Value per Share: $67.11 vs analyst estimates of $78.65 (9.3% year-on-year growth, 14.7% miss)
- Market Capitalization: $12.88 billion
“In 2025 we executed on our strategy, delivered for our customers, and drove disciplined operational performance. Additionally, we materially improved the risk profile of the Closed Block, and returned significant capital to our shareholders,” said Richard P. McKenney, president and chief executive officer.
Company Overview
Tracing its roots back to 1848 when financial security for workers was virtually non-existent, Unum Group (NYSE: UNM) provides workplace financial protection benefits including disability, life, accident, critical illness, dental and vision insurance primarily through employers.
Revenue Growth
Insurance companies earn revenue from three primary sources: 1) The core insurance business itself, often called underwriting and represented in the income statement as premiums 2) Income from investing the “float” (premiums collected upfront not yet paid out as claims) in assets such as fixed-income assets and equities 3) Fees from various sources such as policy administration, annuities, or other value-added services. Regrettably, Unum Group’s revenue grew at a sluggish 1.9% compounded annual growth rate over the last five years. This fell short of our benchmarks and is a poor baseline for our analysis.
Long-term growth is the most important, but within financials, a half-decade historical view may miss recent interest rate changes and market returns. Unum Group’s annualized revenue growth of 3% over the last two years is above its five-year trend, but we were still disappointed by the results. 
Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.
This quarter, Unum Group missed Wall Street’s estimates and reported a rather uninspiring 0.1% year-on-year revenue decline, generating $3.24 billion of revenue.
Net premiums earned made up 80.8% of the company’s total revenue during the last five years, meaning Unum Group barely relies on non-insurance activities to drive its overall growth.
While insurers generate revenue from multiple sources, investors view net premiums earned as the cornerstone - its direct link to core operations stands in sharp contrast to the unpredictability of investment returns and fees.
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Book Value Per Share (BVPS)
Insurers are balance sheet businesses, collecting premiums upfront and paying out claims over time. Premiums collected but not yet paid out, often referred to as the float, are invested and create an asset base supported by a liability structure. Book value per share (BVPS) captures this dynamic by measuring these assets (investment portfolio, cash, reinsurance recoverables) less liabilities (claim reserves, debt, future policy benefits). BVPS is essentially the residual value for shareholders.
We therefore consider BVPS very important to track for insurers and a metric that sheds light on business quality because it reflects long-term capital growth and is harder to manipulate than more commonly-used metrics like EPS.
Unum Group’s BVPS grew at a tepid 4.7% annual clip over the last five years. However, BVPS growth has accelerated recently, growing by 16% annually over the last two years from $49.91 to $67.11 per share.
Over the next 12 months, Consensus estimates call for Unum Group’s BVPS to grow by 24.4% to $78.65, elite growth rate.
Key Takeaways from Unum Group’s Q4 Results
We struggled to find many positives in these results. Its EPS missed and its book value per share fell short of Wall Street’s estimates. Overall, this was a weaker quarter. The stock traded down 7.5% to $70.04 immediately after reporting.
Unum Group didn’t show it’s best hand this quarter, but does that create an opportunity to buy the stock right now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).
