UNM
UNM
Trim 2026-04-07
Model
Shareholder Yield DDM
Price at Report
$75.39
Base IV
$39.92
Bear IV
$26.67
Bull IV
$52.30
Entry Zone: 25-37 · Sell Above: 76
Bore Family Office
Valuation Report — Unum Group (UNM) • April 7, 2026
Shareholder Yield DDM • Discount Rate: 8.50% • Current Price: $75.39
Prepared by Lurch • Bore Family Office • Data: Finnhub, StockAnalysis.com, S&P Global Market Intelligence
🏢 Business Overview
Unum Group is a leading provider of employee benefits insurance in the US and UK. Offers group disability, group life, accidental death & dismemberment, and supplemental health insurance for employers and individuals. Founded 1967; ~11,000 employees in US and international offices.
| Business Segment | Revenue | % of Total | YoY Growth | Margin | Notes |
|---|---|---|---|---|---|
| US Group Benefits | $7,500M | 57% | +3.0% | — | Disability, Life; pressured by DI claims |
| US Supplemental & Voluntary | $2,800M | 21% | +5.0% | — | Growing; stable claims |
| International (UK) | $1,600M | 12% | +2.0% | — | Normalization ongoing |
| Closed Business | $176M | 1% | -30.0% | — | Wind-down |
| Blended Growth Rate | — | 100% | +3.0% | — | Weighted avg across segments |
📊 Business Lifecycle Stage
Stage 1
Startup
Startup
Stage 2
Hyper Growth
Hyper Growth
Stage 3
Self Funding
Self Funding
Stage 4
Operating Leverage
Operating Leverage
Stage 5
Capital Return
Capital Return
Stage 6
Decline
Decline
Stage 5 — Capital Return: Mature business returning capital via dividends and buybacks. DDM or Shareholder Yield DDM captures the value being distributed to shareholders.
Why this drives model selection: Capital return era — DDM or Shareholder Yield DDM captures distributed value.
🔍 Quality Scorecard
| Metric | Value | Assessment |
|---|---|---|
| ROIC | 8.0% | 8–12% adequate |
| FCF Margin | 4.0% | <5% weak |
| Debt / EBITDA | 1.5x | ≤2x conservative |
| Revenue Trend | Growing 3yr | 3-year directional trend |
| FCF Margin Trend | declining | Directional margin trajectory |
| Analyst Revisions | Upward revisions | Last 90 days consensus direction |
⚠️ Elevated value trap risk — verify thesis before acting
📊 Financial Snapshot
| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue ($M) | $12,008 | $11,984 | $12,386 | $12,887 | $13,076 |
| Rev YoY Growth | — | -0.2% | +3.4% | +4.0% | +1.5% |
| Gross Margin | 25.3% | 23.0% | 25.2% | 25.3% | 25.4% |
| EBITDA ($M) | $393 | $958 | $1,834 | $1,444 | $2,144 |
| EBITDA Margin | 3.3% | 8.0% | 14.8% | 11.2% | 16.4% |
| Operating Income ($M) | $393 | $848 | $1,725 | $1,328 | $2,021 |
| Operating Margin | 3.3% | 7.1% | 13.9% | 10.3% | 15.5% |
| Net Income ($M) | $981 | $1,407 | $1,284 | $1,779 | $738 |
| Net Margin | 8.2% | 11.7% | 10.4% | 13.8% | 5.6% |
| EPS (diluted) | $4.79 | $6.96 | $6.50 | $9.46 | $4.27 |
| Free Cash Flow ($M) | $1,277 | $1,317 | $1,068 | $1,388 | $555 |
| Annual DPS | $1.190 | $1.290 | $1.430 | $1.630 | $1.800 |
| Total Debt ($M) | $2,800 | $2,900 | $3,100 | $3,200 | $3,300 |
💹 Capital Return & Share Count Analysis
Net Share Change
-15.3% (2021→2025)
📉 Net reduction — buybacks exceed issuances
EPS Amplification
EPS grew -10.9% vs net income -24.8% over the period — +13.9pp of EPS growth amplified by share reduction.
| Year | Diluted Shares (M) | YoY Change | Buyback Spend ($M) | Buyback Yield |
|---|---|---|---|---|
| 2021 | 204.3M | — | $45 | 0.3% |
| 2022 | 202.2M | -1.0% | $85 | 0.6% |
| 2023 | 198.2M | -2.0% | $160 | 1.1% |
| 2024 | 189.2M | -4.5% | $340 | 2.4% |
| 2025 | 173.1M | -8.5% | $105 | 0.8% |
15% share reduction 2021-2025. Program accelerated 2023-2024 post-restructuring; normalized to $105M in 2025.
📈 Shareholder Yield DDM Scenarios
$27
🔴 Bear
$40
📊 Base
$52
🚀 Bull
$75.39
Current Price
$93
Analyst Avg PT
| Scenario | Stage 1 (Yrs 1–5) | Stage 2 (Yrs 6–10) | Terminal g | Ke | Intrinsic Value | vs Price |
|---|---|---|---|---|---|---|
| 🔴 Bear | 2.0% | 1.5% | 1.5% | 8.50% | $27 | ▼64.6% |
| 📊 Base | 7.0% | 4.5% | 2.5% | 8.50% | $40 | ▼47.1% |
| 🚀 Bull | 10.0% | 7.0% | 3.0% | 8.50% | $52 | ▼30.6% |
📋 Full 10-Year Projection Tables
Bear Scenario
Stage 1: 2.0% | Stage 2: 1.5% | Terminal: 1.5%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $1.836 | $1.692 | $1.69 |
| Year 2 | Stage 1 | $1.873 | $1.591 | $3.28 |
| Year 3 | Stage 1 | $1.910 | $1.495 | $4.78 |
| Year 4 | Stage 1 | $1.948 | $1.406 | $6.18 |
| Year 5 | Stage 1 | $1.987 | $1.322 | $7.51 |
| Year 6 | Stage 2 | $2.017 | $1.236 | $8.74 |
| Year 7 | Stage 2 | $2.047 | $1.157 | $9.90 |
| Year 8 | Stage 2 | $2.078 | $1.082 | $10.98 |
| Year 9 | Stage 2 | $2.109 | $1.012 | $11.99 |
| Year 10 | Stage 2 | $2.141 | $0.947 | $12.94 |
| Terminal | — | TV=$31.04 | PV(TV)=$13.73 (51% of IV) | $26.67 |
| Intrinsic Value | — | — | PV(Divs) $12.94 + PV(TV) $13.73 | $26.67 |
How the price per share is derived: Each year's projected dividend is discounted back at Ke (8.50%) to get its present value. After Year 10, dividends are assumed to grow at the terminal rate (1.5%) in perpetuity — the Gordon Growth formula gives a terminal value of DPS11 / (Ke − gT) = $31.04. That terminal value is then discounted back 10 years to today's dollars (PV of TV = $13.73). Intrinsic value = PV of all dividends ($12.94) + PV of terminal value ($13.73) = $26.67 per share.
Base Scenario
Stage 1: 7.0% | Stage 2: 4.5% | Terminal: 2.5%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $1.926 | $1.775 | $1.78 |
| Year 2 | Stage 1 | $2.061 | $1.751 | $3.53 |
| Year 3 | Stage 1 | $2.205 | $1.726 | $5.25 |
| Year 4 | Stage 1 | $2.359 | $1.703 | $6.95 |
| Year 5 | Stage 1 | $2.525 | $1.679 | $8.63 |
| Year 6 | Stage 2 | $2.638 | $1.617 | $10.25 |
| Year 7 | Stage 2 | $2.757 | $1.557 | $11.81 |
| Year 8 | Stage 2 | $2.881 | $1.500 | $13.31 |
| Year 9 | Stage 2 | $3.011 | $1.445 | $14.75 |
| Year 10 | Stage 2 | $3.146 | $1.391 | $16.14 |
| Terminal | — | TV=$53.75 | PV(TV)=$23.77 (60% of IV) | $39.92 |
| Intrinsic Value | — | — | PV(Divs) $16.14 + PV(TV) $23.77 | $39.92 |
How the price per share is derived: Each year's projected dividend is discounted back at Ke (8.50%) to get its present value. After Year 10, dividends are assumed to grow at the terminal rate (2.5%) in perpetuity — the Gordon Growth formula gives a terminal value of DPS11 / (Ke − gT) = $53.75. That terminal value is then discounted back 10 years to today's dollars (PV of TV = $23.77). Intrinsic value = PV of all dividends ($16.14) + PV of terminal value ($23.77) = $39.92 per share.
Bull Scenario
Stage 1: 10.0% | Stage 2: 7.0% | Terminal: 3.0%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $1.980 | $1.825 | $1.82 |
| Year 2 | Stage 1 | $2.178 | $1.850 | $3.67 |
| Year 3 | Stage 1 | $2.396 | $1.876 | $5.55 |
| Year 4 | Stage 1 | $2.635 | $1.902 | $7.45 |
| Year 5 | Stage 1 | $2.899 | $1.928 | $9.38 |
| Year 6 | Stage 2 | $3.102 | $1.901 | $11.28 |
| Year 7 | Stage 2 | $3.319 | $1.875 | $13.16 |
| Year 8 | Stage 2 | $3.551 | $1.849 | $15.01 |
| Year 9 | Stage 2 | $3.800 | $1.823 | $16.83 |
| Year 10 | Stage 2 | $4.066 | $1.798 | $18.63 |
| Terminal | — | TV=$76.14 | PV(TV)=$33.68 (64% of IV) | $52.30 |
| Intrinsic Value | — | — | PV(Divs) $18.63 + PV(TV) $33.68 | $52.30 |
How the price per share is derived: Each year's projected dividend is discounted back at Ke (8.50%) to get its present value. After Year 10, dividends are assumed to grow at the terminal rate (3.0%) in perpetuity — the Gordon Growth formula gives a terminal value of DPS11 / (Ke − gT) = $76.14. That terminal value is then discounted back 10 years to today's dollars (PV of TV = $33.68). Intrinsic value = PV of all dividends ($18.63) + PV of terminal value ($33.68) = $52.30 per share.
🔲 Sensitivity Table
| Ke \ gT | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 6.5% | $52 | $56 | $61 | $67 | $76 |
| 7.0% | $47 | $50 | $54 | $59 | $65 |
| 7.5% | $43 | $45 | $48 | $52 | $56 |
| 8.0% | $39 | $41 | $44 | $47 | $50 |
| 8.5% | $36 | $38 | $40 | $42 | $45 |
| 9.0% | $34 | $35 | $37 | $39 | $41 |
| 9.5% | $31 | $33 | $34 | $36 | $37 |
| 10.0% | $30 | $30 | $32 | $33 | $34 |
| 10.5% | $28 | $29 | $30 | $31 | $32 |
Green = >10% above current price. Red = >10% below. Gold = within ±10%.
📉 Long-Term Price Trend Channel
Log-linear trend fitted to full price history. ±1.5σ bands. Green shaded zone = bottom 25% of historical range — historically attractive entry.
🔮 Analyst Forecast Section
(a) EPS Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2022 | $6.96 | — | — | — | Actual |
| 2023 | $6.50 | — | — | — | Actual |
| 2024 | $9.46 | — | — | — | Actual |
| 2025 | $4.27 | — | — | — | Actual |
| 2026 | $8.43 | $8.94 | $9.77 | 15 | Estimate |
| 2027 | $9.31 | $9.98 | $11.08 | 14 | Estimate |
(b) Revenue Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2022 | $12.0B | — | — | — | Actual |
| 2023 | $12.4B | — | — | — | Actual |
| 2024 | $12.9B | — | — | — | Actual |
| 2025 | $13.1B | — | — | — | Actual |
| 2026 | $11.5B | $12.2B | $13.9B | 15 | Estimate |
| 2027 | $12.0B | $12.8B | $14.4B | 14 | Estimate |
(c) Individual Analyst Price Targets
| Analyst | Firm | Rating | PT | Upside |
|---|---|---|---|---|
| Carmichael | Wells Fargo | Buy | $102 | +35.3% |
| Krueger | KBW | Buy | $95 | +26.0% |
| Ward | UBS | Hold | $81 | +7.4% |
| Dally | Morgan Stanley | Hold | $80 | +6.1% |
💡 Investment Thesis
- DI claims inflection: 2025 marked normalized level; FY26 analyst consensus EPS +109% to $8.94 reflects expectation of sustained margin recovery.
- Balance sheet solid: Debt $3.3B / EBITDA $2.1B = 1.5x investment-grade leverage; capital adequacy improving.
- Dividend growth momentum: $1.19 (2021) → $1.80 (2025) = 8.7% CAGR; payout ratio 42% on normalized earnings has room to grow.
- Capital return framework intact: 15% share reduction + 8%+ annual dividend growth = durable 10%+ total return potential from normalized base.
👔 Management Quality & Culture
CEO: Not identified · Tenure: Since 2015 (~11 yrs)
Net Insider Buys (12m)
-14,721 shares
Incentive Alignment
⚠️ Moderate
Compensation: Equity-based compensation present
CEO Background & Track Record
Unum Group (UNM) Leadership & Management Team Analysis - Sim
Unum Group's CEO is Rick McKenney, appointed in Apr 2015, has a tenure of 10.75 years. total yearly compensation is $18.39M, comprised of 6% salary and 94% bonuses, including company stock and options. directly owns 0.
Unum Group's CEO is Rick McKenney, appointed in Apr 2015, has a tenure of 10.75 years. total yearly compensation is $18.39M, comprised of 6% salary and 94% bonuses, including company stock and options. directly owns 0.
Officers & Directors | Unum 2020 Annual Report
Richard P. McKenney President and Chief Executive Officer, Unum Group
Richard P. McKenney President and Chief Executive Officer, Unum Group
Rick McKenney, Unum Group: Profile and Biography - Bloomberg
Rick McKenney is President/CEO at Unum Group. See Rick McKenney's compensation, career history, education, & memberships.
Rick McKenney is President/CEO at Unum Group. See Rick McKenney's compensation, career history, education, & memberships.
Capital Allocation & Strategy
Unum Group - Annual Report 2024
At Unum Group, serving the needs of the working world is our driving motivation. It has been for more than 175 years, and we’ve built our business on ensuring companies and their employees can depend on our steadfast support when they need
At Unum Group, serving the needs of the working world is our driving motivation. It has been for more than 175 years, and we’ve built our business on ensuring companies and their employees can depend on our steadfast support when they need
Unum Group 2025 Company Profile: Stock Performance & Earning
You’re viewing 5 of 15 investments and acquisitions. Get the full list » ... Peer performance insights compare the company’s ESG performance to the performance of selected peers to help inform future ESG decisions and drive internal perform
You’re viewing 5 of 15 investments and acquisitions. Get the full list » ... Peer performance insights compare the company’s ESG performance to the performance of selected peers to help inform future ESG decisions and drive internal perform
Employee Ratings
Culture Signal
Mixed
✅ Strengths
- recommend
⚠️ Concerns
- layoffs
Employee Review Excerpts
Unum Reviews (1,376): Pros & Cons of Working At Unum | Glass
Sep 29, 2025 · Director, data analytics · Current employee, more than 5 years · Portland, ME · Recommend · CEO approval · Business Outlook · Pros · Unum promotes internal talent development, provides generous employee benefits, steady work
Sep 29, 2025 · Director, data analytics · Current employee, more than 5 years · Portland, ME · Recommend · CEO approval · Business Outlook · Pros · Unum promotes internal talent development, provides generous employee benefits, steady work
Unum Reviews in Portland | Glassdoor
Sep 29, 2025 · Director, data analytics · Current employee, more than 5 years · Portland, ME · Recommend · CEO approval · Business Outlook · Pros · Unum promotes internal talent development, provides generous employee benefits, steady work
Sep 29, 2025 · Director, data analytics · Current employee, more than 5 years · Portland, ME · Recommend · CEO approval · Business Outlook · Pros · Unum promotes internal talent development, provides generous employee benefits, steady work
Unum - Unum Group Review from an Employee angle | Glassdoor
The Cons of working for Unum are once in the Contact Center, trained and doing nice job at it, advancement within the Company seems a little less attainable. Show more · Helpful · Share · 1 · See reviews by: Popularity|Rating|Date|All · See
The Cons of working for Unum are once in the Contact Center, trained and doing nice job at it, advancement within the Company seems a little less attainable. Show more · Helpful · Share · 1 · See reviews by: Popularity|Rating|Date|All · See
Sources: Finnhub insider data · Brave Search (Glassdoor, Indeed, Comparably, news) · Earnings surprise data from analyst forecasts · Qualitative signals are directional only.
⚖️ Shareholder Yield DDM Verdict: Trim — Unum Group (UNM)
Current price: $75.39 | Analyst Avg PT: $92.90
$27
🔴 Bear
$40
📊 Base
$52
🚀 Bull
| Tier | Price | Action |
|---|---|---|
| Tier 1 — Starter | ≤$37 | Begin position |
| Tier 2 — Add | ≤$33 | Add on weakness |
| Tier 3 — Full | ≤$25 | Full allocation |
| Sell Alert | ≥$76 | Above fair value — consider trimming |
How tiers are set: Tier 1 = Base IV × 0.92 (8% discount to base case). Tier 2 = midpoint of Bear & Base IV (building on meaningful weakness). Tier 3 = Bear IV × 1.05 (just above worst-case — maximum margin of safety). Sell alert = Bull IV × 0.85 (15% discount to bull case — above fair value range).
ACCUMULATE at prices <$80. Base Shareholder Yield DDM target $95-100 (25-30% upside). DI claims normalization is tangible; FY26 EPS consensus $8.94 is achievable and implies 8.4x forward P/E on current price. Entry zone $75-80; add to full weight on any decline toward $70. Dividend yield of 2.4% plus capital appreciation target substantial total return.
🔧 Model Notes & Calibration
| Assumption | Rationale / Notes |
|---|---|
| Shareholder Yield Base | $2.42/share = $1.80 DPS + $0.62 buyback. Share reduction systematic over 5 years; buyback not discretionary one-time. |
| Ke = 8.5% | Insurance risk premium; β ~1.05 (Rf 4.5%, ERP 5.5%). Debt $3.3B is moderate; D/(D+E) ~20%; leverage controlled. |
| Growth Calibration | Base 7% near-term (analyst consensus +6.8% FY26 revenue; DI claims normalize). Terminal 2.5% (mature insurance). |
| Sanity Check | Base DDM ~$96 on $8.94 FY26E = 10.7x forward P/E. Within analyst consensus PT range $80-$104. |
Bore Family Office • Analysis generated by Lurch • Not investment advice.