Hanover Insurance

THG · NYSE · Financials · Financials, fiscal 2016 to 2025

THG · Last close · October 26, 2026

$239.07

Hanover Insurance's revenue rose 5.7% to $6.6 billion in fiscal 2025. Its operating margin was 14.2%, up from 10.4% a year earlier. Free cash flow was $1.2 billion, up 47.0%. It paid out $260 million in dividends and buybacks, 22% of free cash flow. The diluted share count rose 0.3%.

HANOVER INSURANCE GROUP, INC. Latest fiscal year ended December 31, 2025 10-K filed February 20, 2026 · 0001193125-26-060983 Updated October 18, 2026

Revenue

$6.6B

5.7%

Operating margin

14.2%

3.7 pts

Net income

$662M

55.5%

Free cash flow

$1.2B

47.0%

Return on capital

21.3%

4.5 pts

Market cap

$8.5B

Oct 26 close

P/E

11.4x

On $20.94 EPS, 4 qtrs

Operating margin is operating income as a share of revenue. Free cash flow is cash from operations minus capital spending. Return on capital is after-tax operating income as a share of the money invested in the business: debt plus equity, minus cash. Market cap is the last closing share price times the latest diluted share count, so it is approximate. P/E is the last close divided by diluted earnings per share over the last four quarters, or the latest fiscal year where the quarters aren't available; there is none when the company made a loss.

Charts show fiscal years, from the 10-K filings.

Revenue and margins

Revenue

US$ billions, fiscal years

Margins

Percent of revenue

GrossOperatingNetFree cash flow

Net income and earnings per share

From fiscal 2016 to 2025, earnings per share grew 19.7% a year and net income 17.5% a year, as buybacks cut the share count by 16%.

Net income

US$ billions, fiscal years; loss years in red.

Diluted earnings per share

US$ per share, fiscal years, restated for any stock splits; loss years in red.

Returns on capital

Return on capital and on equity

Percent. Return on capital is after-tax operating income over the money invested in the business (debt plus equity, minus cash); return on equity is net income over shareholders' equity. Both use the average of opening and closing balances.

Return on capitalReturn on equity

Cash flow

Free cash flow

US$ billions. Cash from operations minus capital expenditure; negative years in red.

Payouts and share count

Dividends and buybacks

US$ billions, cash paid in each fiscal year

DividendsShare buybacks

Diluted share count

Weighted-average diluted shares, millions

Valuation

Two ways to value Hanover Insurance yourself, both starting from its filings: a discounted cash flow model and the price-to-earnings method.

Discounted cash flow (DCF)

A discounted cash flow (DCF) model values a business as the cash it may generate in future, discounted back to today. The starting figures come from Hanover Insurance's 10-K (or, for net cash and shares, its latest 10-Q) and the assumptions are yours: start from one of three example scenarios, then change any figure to see what it implies for a share, and how that compares with the last share price.

Value per share on three example scenarios, from Hanover Insurance's cash from operations minus depreciation in fiscal 2025 (free cash flow before spending to grow: capital spending was -1.7 times depreciation, which holds its free cash flow down) of $1.2B, net cash of −$96M at December 31, 2025 and 36 million diluted shares, from its filings. The scenarios are fitted to Hanover Insurance: the base scenario's growth in years 1 to 5 is its revenue growth over the last 3 years, 6.4% a year; the cautious and optimistic ones are lower and higher, and growth in years 6 to 10 is halfway to the long-run rate. The base scenario's discount rate is 8%: 7% for a stable business (Property & Casualty Insurance), plus 1 point as a smaller company, worth $8.5B; the cautious and optimistic ones use a point more and a point less. Select one to load it into the calculator. These are the model's arithmetic on those assumptions, not a forecast or a price target.

From the filings

Starting free cash flow, US$ millions

Cash from operations minus depreciation in fiscal 2025: a rough guide to cash flow before spending to grow, for a company building heavily.

Net cash, US$ millions

Cash and short-term investments minus debt and finance leases at December 31, 2025. Negative means net debt.

Diluted shares, millions

Weighted-average diluted shares in fiscal 2025.

Your assumptions

Start from

Fitted to Hanover Insurance's own revenue growth, as above. Cautious: growth of 3% then 2.5% a year, 2% after year 10, a 9% discount rate. Base: growth of 6.5% then 4.5% a year, 2.5% after year 10, a 8% discount rate. Optimistic: growth of 9.5% then 6% a year, 3% after year 10, a 7% discount rate.

Free cash flow growth, years 1 to 5 (% a year)

Free cash flow growth, years 6 to 10 (% a year)

Growth after year 10 (% a year)Long-run growth forever after year 10. Usually close to inflation, and always below the discount rate.

Discount rate (% a year)The yearly return an investor wants for the risk. A higher rate gives a lower value.

Value per share on these assumptions

—

Last close, October 26, 2026: $239.07
Value on these assumptions, against the last close: —

Cash flows in years 1 to 10, valued today: —
Everything after year 10, valued today: —
Plus net cash: —
Share of value from after year 10: —

Projected free cash flow

US$ billions. Each column is one year's projected free cash flow, split into what it is worth today and the part removed by discounting.

Value todayRemoved by discounting

How the value changes with two assumptions

Value per share in US$, with the growth rates above. The highlighted cell matches the current assumptions.

How the model works. Free cash flow grows at the first rate for five years and the second rate for five more, and each year is discounted at the discount rate. Everything after year 10 is valued as year-10 cash flow × (1 + growth after year 10) ÷ (discount rate − growth after year 10), discounted back ten years. Net cash is added and the total is divided by diluted shares. The result depends entirely on the assumptions. It is not a forecast, a price target or a recommendation. The last close is the consolidated US closing price, from Databento.

Price-to-earnings (P/E) method

Another common way to value a company is to multiply its earnings per share by a price-to-earnings (P/E) multiple: the number of years of today's earnings an investor pays for a share. A higher multiple usually means investors expect earnings to grow. Choose a multiple, for example from similar companies, to see the value it gives.

Value per share on three example scenarios, from Hanover Insurance's earnings per share of $20.94 (over the last four quarters). Each grows earnings for a year at the cash flow scenarios' rates and applies a multiple to next year's earnings: 11.4×, the middle of Hanover Insurance's own P/E today, its peers' median and its sector's median (Hanover Insurance's own P/E today) for the base scenario, 20% less and more for the cautious and optimistic ones. The price is brought back a year at 9%, 8% and 7%. Select one to load it into the calculator. These are the model's arithmetic on those assumptions, not a forecast or a price target.

Earnings per share, US$

Diluted earnings per share over the four quarters to June 30, 2026, from the 10-Qs and 10-K.

P/E multiple

P/E today is the last close divided by the latest earnings per share, the four quarters' where available. Peers: Selective Insurance Group, Old Republic International, Cincinnati Financial, Fidelity National Financial.

Earnings growth in the years ahead (% a year) Starts at Hanover Insurance's revenue growth over the last 3 years, 6.4% a year, as the base scenario does.

Earnings per share in the years ahead, US$

Year 1Year 2Year 3Year 4Year 5

Type your own estimate for any year; the years after it carry on at the growth rate.

Apply the multiple to earnings

A multiple on a future year's earnings gives the price then, brought back to today at the discount rate below.

Discount rate (% a year) The yearly return an investor wants for the risk, as in the cash flow model.

Value per share today at this multiple

—

Last close, October 26, 2026: $239.07
Value at this multiple, against the last close: —
Hanover Insurance's P/E at the last close: 11.4×

Company	Last close	Earnings per share	P/E today
Fidelity National FinancialFNF	$39.94	$2.88	13.9×
Selective Insurance GroupSIGI	$98.79	$8.32	11.9×
Hanover InsuranceTHG	$239.07	$20.94	11.4×
Cincinnati FinancialCINF	$177.31	$17.05	10.4×
Old Republic InternationalORI	$38.43	$4.56	8.4×

How the P/E method works. Value per share is earnings per share times the multiple. On a future year's earnings, that gives the price in that year, which is brought back to today at the discount rate: price ÷ (1 + discount rate) for each year ahead. It is quick and easy to compare across companies, but it ignores debt and cash, and earnings can swing with one-off gains and charges, so a multiple says most about steady, profitable businesses. Like the cash flow model, the result depends entirely on the assumptions you choose. It is not a forecast, a price target or a recommendation.

Balance sheet

Fiscal year end	FY21	FY22	FY23	FY24	FY25
Cash and short-term investments	231	305	316	436	1,123
Debt incl. finance leases	—	—	783	784	1,218
Net debt (negative means net cash)	—	—	467	349	96
Net debt to EBITDA	—	—	4.2x	0.5x	0.1x
Debt to equity	—	—	0.3x	0.3x	0.3x
Interest coverage	12.7x	8.4x	3.1x	19.1x	21.6x
Current ratio	—	—	—	—	—
Quick ratio	—	—	—	—	—

US$ millions unless stated, at each fiscal year end. Net debt to EBITDA is debt minus cash, divided by operating income before depreciation and amortization: roughly how many years of those earnings the net debt equals. Debt to equity is debt as a multiple of shareholders' equity. Interest coverage is operating income divided by interest expense. The current ratio is current assets over current liabilities; the quick ratio leaves out inventory.

Insider trades

Over the 12 months between October 27, 2025 and October 26, 2026, no insider bought Hanover Insurance shares on the open market, and 10 insiders sold $16.2 million, $4.6 million of it under trading plans set up in advance.

Date	Insider	Trade	Shares	Price	Value	Filing
Aug 20, 2026	Dennis Francis KerriganExecutive Vice President	Sold plan	2,104	$222.41	$467,945	Form 4
Aug 19, 2026	Dennis Francis KerriganExecutive Vice President	Sold plan	6,551	$220.79	$1.4 million	Form 4
Aug 6, 2026	Theodore H Bunting JRDirector	Sold	600	$230.20	$138,120	Form 4
Aug 5, 2026	Theodore H Bunting JRDirector	Sold	600	$228.03	$136,818	Form 4
Aug 3, 2026	Jane D CarlinDirector	Sold	1,000	$231.50	$231,500	Form 4
Jun 3, 2026	Bryan J SalvatoreExecutive Vice President	Sold	16,394	$185.76	$3.0 million	Form 4
May 21, 2026	Francisco AristeguietaDirector	Sold	1,000	$195.37	$195,370	Form 4
May 20, 2026	John C RochePresident and CEO, Director	Sold plan	8,358	$193.74	$1.6 million	Form 4
May 20, 2026	Dennis Francis KerriganExecutive Vice President	Sold	6,262	$192.99	$1.2 million	Form 4
May 18, 2026	John C RochePresident and CEO, Director	Sold plan	5,251	$198.06	$1.0 million	Form 4
May 14, 2026	Denise LowsleyExecutive Vice President	Sold	4,175	$191.73	$800,473	Form 4
May 8, 2026	Denise LowsleyExecutive Vice President	Sold	1,062	$188.43	$200,113	Form 4

The latest 12 of 17 trades. Open-market purchases and sales by officers, directors and 10% owners, from their Form 4 filings with the SEC: one row per person, day and filing, at the day's average price. Grants, option exercises and shares withheld for tax aren't counted. Insiders buy and sell for many reasons, such as taxes, spreading their savings or a plan set up months earlier, so a trade on its own says little about where a company is heading. For information only, not investment advice. Insider trades at all companies

Piotroski F-score

The F-score counts how many of nine simple tests of profitability, funding and efficiency a company passed in a year (Piotroski, 2000). The more tests passed, the stronger the year: 8 or 9 is strong, 0 to 2 weak. Companies that report no gross profit are scored on the other eight.

Test	FY23	FY24	FY25
Net income is positive	Pass	Pass	Pass
Cash from operations is positive	Pass	Pass	Pass
Return on assets rose	Fail	Pass	Pass
Cash from operations exceeds net income	Pass	Pass	Pass
Debt fell relative to assets	—	Pass	Fail
Current ratio rose	—	—	—
Share count didn't rise	Pass	Fail	Fail
Gross margin rose	—	—	—
Revenue rose relative to assets	Pass	Fail	Pass
F-score	—	—	—
Accruals ratio	−2.3%	−2.5%	−3.2%

The accruals ratio is net income minus cash from operations, over average total assets.

Compare

Put Hanover Insurance side by side with any other company we cover: revenue, growth, margins, cash flow and returns, with ten years of charts.

Similar companies

Company	Year	Revenue growth	Operating margin	Free cash flow margin	Return on capital	Net debt to EBITDA	F-score	Compare
Hanover Insurance	FY25	5.7%	14.2%	17.8%	21.3%	0.1x	—
Selective Insurance Group	FY25	9.8%	—	22.4%	14.6%	0.3x	—	Compare
Old Republic International	FY25	11.0%	—	—	—	—	—	Compare
Cincinnati Financial	FY25	11.4%	—	24.5%	17.1%	−0.3x	—	Compare
Fidelity National Financial	FY25	5.6%	—	—	—	−0.1x	—	Compare

Each company's latest fiscal year. Fiscal years end in different months, so the periods don't line up exactly. Free cash flow margin is free cash flow as a share of revenue. Net debt to EBITDA is explained under the balance sheet, and the F-score above.

10 years of figures

Fiscal year	FY16	FY17	FY18	FY19	FY20	FY21	FY22	FY23	FY24	FY25
Income statement
Revenue	4,054	4,268	4,494	4,891	4,825	5,228	5,469	5,994	6,237	6,594
Revenue growth	−19.5%	5.3%	5.3%	8.8%	−1.4%	8.3%	4.6%	9.6%	4.1%	5.7%
Gross profit	—	—	—	—	—	—	—	—	—	—
Research and development	—	—	—	—	—	—	—	—	—	—
Operating income	193	327	406	454	485	432	285	106	650	933
Net income	155	186	391	425	359	423	116	35	426	662
Diluted EPS (US$)	3.59	4.33	9.09	10.46	9.42	11.60	3.21	0.98	11.70	18.16
Diluted shares (millions)	43	43	43	41	38	36	36	36	36	36
Cash flow
Cash from operations	743	705	551	603	708	824	722	362	806	1,178
Capital expenditure	16	19	13	13	15	8	18	12	10	8
Free cash flow	728	686	538	590	693	816	704	350	796	1,170
Dividends paid	80	87	94	386	100	102	109	117	124	131
Share buybacks	106	37	58	564	213	163	31	0	27	129
Acquisitions	0	0	0	0	0	0	0	0	0	0
Stock-based compensation	12	12	13	17	20	23	29	31	31	36
Balance sheet at fiscal year end
Cash and short-term investments	283	298	1,021	216	121	231	305	316	436	1,123
Debt incl. finance leases	786	787	778	653	—	—	—	783	784	1,218
Total assets	14,220	15,470	12,400	12,490	13,444	14,254	13,995	14,613	15,274	16,946
Total liabilities	11,363	12,472	9,445	9,574	10,242	11,109	11,661	12,147	12,433	13,374
Shareholders' equity	2,858	2,998	2,955	2,916	3,202	3,136	2,334	2,466	2,842	3,572
Margins and ratios
Gross margin	—	—	—	—	—	—	—	—	—	—
Operating margin	4.8%	7.7%	9.0%	9.3%	10.1%	8.3%	5.2%	1.8%	10.4%	14.2%
Net margin	3.8%	4.4%	8.7%	8.7%	7.4%	8.1%	2.1%	0.6%	6.8%	10.1%
Free cash flow margin	17.9%	16.1%	12.0%	12.1%	14.4%	15.6%	12.9%	5.8%	12.8%	17.8%
Return on capital	5.8%	7.0%	11.1%	12.3%	—	—	—	—	16.8%	21.3%
Return on equity	5.4%	6.4%	13.1%	14.5%	11.7%	13.3%	4.2%	1.5%	16.1%	20.7%
Return on assets	1.1%	1.2%	2.8%	3.4%	2.8%	3.0%	0.8%	0.2%	2.9%	4.1%
Net debt to EBITDA	2.2x	1.4x	−0.6x	0.9x	—	—	—	4.2x	0.5x	0.1x

US$ millions unless stated. Where a later 10-K restated a year, the latest filed figure is shown. Download all figures (CSV, US$ millions)

Source: Hanover Insurance's Form 10-K filings, from SEC EDGAR. For information only, not investment advice. The Filing Desk is not affiliated with Hanover Insurance.