Safety Insurance Group, Inc.

SAFT

Financial ServicesInsurance - Property & CasualtyNASDAQ

$72.87

Market Cap: $1.07B

Safety Insurance Group, Inc. (SAFT) Valuation Summary

Updated May 11, 2026 10:32

Model	Range	Fair Value	Upside
▸ Discounted Cash Flow
Growth Exit 5Y	$367.18 – $1,563.81	$583.04	+700.1%
Growth Exit 10Y	$453.07 – $1,890.64	$714.55	+880.6%
EBITDA Exit 5Y	$233.30 – $554.29	$380.08	+421.6%
EBITDA Exit 10Y	$319.34 – $715.02	$487.16	+568.5%
▸ Trading Multiples
P/E	$70.32 – $114.56	$98.68	+35.4%
EV/EBITDA	$55.27 – $82.68	$63.82	-12.4%
EV/Revenue	$56.38 – $245.21	$86.27	+18.4%
▸ PEG
PEG Fair Value	$53.60 – $53.60	$53.60	-26.4%
▸ Earnings Power Value
Earnings Power Value	$287.08 – $438.11	$346.83	+376.0%
▸ Dividend Discount
Dividend Discount	$48.08 – $122.38	$67.08	-7.9%

Valuation History

DCF Analysis

Fair Value

$583.04

Market Price

$72.87

Upside / Downside

+700.1%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Safety Insurance Group, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 10.4% to 9.7% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 142, DPO 54, DIO 10). At a 7.2% WACC with mid-year discounting, the terminal value (82% of enterprise value) is derived from the Gordon Growth Model on Year 6 FCFF at a 2.5% perpetual rate. After subtracting net debt, the equity value implies a fair price of $583.04 per share, suggesting SAFT is undervalued by 700.1% at the current price of $72.87.

FCFF Present Value Calculation

WACC

7.19%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	446	492	540	593	651	667
(−) Net Interest	1	1	1	1	2	2
(+) D&A	4	3	4	5	6	6
EBITDA	451	497	546	599	658	674

(−) Tax	96	106	117	128	140	144
(−) CapEx	6	6	7	7	8	8
(−) ΔWC	34	45	47	51	56	58
Free Cash Flow (FCFF)	315	339	376	413	453	464

Terminal Value						9,909
WACC / Discount Rate	7.2%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	304	306	316	324	332	7,004

Enterprise Value	8,585
Projection Period	1,581	18.4%
Terminal Value	7,004	81.6%

(−) Current Net Debt	(12)

Equity Value	8,597
(/) Outstanding Shares	15

Fair Price	$583.04

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.2%	$777	$881	$1024	$1232	$1564
6.2%	$608	$668	$743	$843	$979
7.2%	$500	$537	$583	$640	$712
8.2%	$423	$449	$479	$515	$559
9.2%	$367	$386	$407	$431	$460

Current price: $72.87. Green = undervalued, Red = overvalued.

Fair Value

$714.55

Market Price

$72.87

Upside / Downside

+880.6%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Safety Insurance Group, Inc.'s cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from 10.4% to 4.1% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 142, DPO 54, DIO 10). At a 7.2% WACC with mid-year discounting, the terminal value (69% of enterprise value) is derived from the Gordon Growth Model on Year 11 FCFF at a 2.5% perpetual rate. After subtracting net debt, the equity value implies a fair price of $714.55 per share, suggesting SAFT is undervalued by 880.6% at the current price of $72.87.

FCFF Present Value Calculation

WACC

7.19%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	446	492	540	593	651	707	760	808	850	885	908
(−) Net Interest	1	1	1	1	2	2	2	2	2	2	2
(+) D&A	4	3	4	5	6	7	7	8	9	9	10
EBITDA	451	497	546	599	658	715	769	818	861	897	919

(−) Tax	96	106	117	128	140	153	164	174	184	191	196
(−) CapEx	6	6	7	7	8	9	9	10	11	11	11
(−) ΔWC	34	45	47	51	56	55	52	47	41	34	35
Free Cash Flow (FCFF)	315	339	376	413	453	499	544	586	626	661	677

Terminal Value											14,450
WACC / Discount Rate	7.2%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	304	306	316	324	332	341	346	348	347	342	7,219

Enterprise Value	10,524
Projection Period	3,305	31.4%
Terminal Value	7,219	68.6%

(−) Current Net Debt	(12)

Equity Value	10,536
(/) Outstanding Shares	15

Fair Price	$714.55

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.2%	$999	$1117	$1279	$1515	$1891
6.2%	$774	$838	$920	$1027	$1174
7.2%	$628	$667	$715	$773	$847
8.2%	$527	$553	$582	$618	$661
9.2%	$453	$470	$490	$513	$540

Current price: $72.87. Green = undervalued, Red = overvalued.

Fair Value

$380.15

Market Price

$72.87

Upside / Downside

+421.7%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Safety Insurance Group, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 10.4% to 9.7% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 142, DPO 54, DIO 10). At a 7.2% WACC with mid-year discounting, the terminal value (72% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 8.4x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $380.08 per share, suggesting SAFT is undervalued by 421.6% at the current price of $72.87.

FCFF Present Value Calculation

WACC

7.19%

3% – 20%

EV/EBITDA Exit Multiple

8.42x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	446	492	540	593	651	667
(−) Net Interest	1	1	1	1	2	2
(+) D&A	4	3	4	5	6	6
EBITDA	451	497	546	599	658	674

(−) Tax	96	106	117	128	140	—
(−) CapEx	6	6	7	7	8	—
(−) ΔWC	34	45	47	51	56	—
Free Cash Flow (FCF)	315	339	376	413	453	—

Peers' EBITDA Multiple						8.4x
Terminal Value						5,677
WACC / Discount Rate	7.19%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	304	306	316	324	332	4,013

Enterprise Value	5,593
Projection Period	1,581	28.3%
Terminal Value	4,013	71.7%

(−) Current Net Debt	(12)
Equity Value	5,605
(÷) Outstanding Shares	15M
Fair Price	$380	+421.7%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	4.4x	6.4x	8.4x	10.4x	12.4x
5.2%	$270	$341	$412	$483	$554
6.2%	$260	$328	$396	$463	$531
7.2%	$251	$315	$380	$445	$509
8.2%	$242	$304	$365	$427	$489
9.2%	$233	$292	$351	$410	$469

Current price: $72.87. Green = undervalued, Red = overvalued.

Based on default parameters

Fair Value

$487.23

Market Price

$72.87

Upside / Downside

+568.6%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Safety Insurance Group, Inc.'s cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from 10.4% to 4.1% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 142, DPO 54, DIO 10). At a 7.2% WACC with mid-year discounting, the terminal value (54% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 8.4x to Year 11 EBITDA. After subtracting net debt, the equity value implies a fair price of $487.16 per share, suggesting SAFT is undervalued by 568.5% at the current price of $72.87.

FCFF Present Value Calculation

WACC

7.19%

3% – 20%

EV/EBITDA Exit Multiple

8.42x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	446	492	540	593	651	707	760	808	850	885	908
(−) Net Interest	1	1	1	1	2	2	2	2	2	2	2
(+) D&A	4	3	4	5	6	7	7	8	9	9	10
EBITDA	451	497	546	599	658	715	769	818	861	897	919

(−) Tax	96	106	117	128	140	153	164	174	184	191	—
(−) CapEx	6	6	7	7	8	9	9	10	11	11	—
(−) ΔWC	34	45	47	51	56	55	52	47	41	34	—
Free Cash Flow (FCF)	315	339	376	413	453	499	544	586	626	661	—

Peers' EBITDA Multiple											8.4x
Terminal Value											7,741
WACC / Discount Rate	7.19%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	304	306	316	324	332	341	346	348	347	342	3,867

Enterprise Value	7,172
Projection Period	3,305	46.1%
Terminal Value	3,867	53.9%

(−) Current Net Debt	(12)
Equity Value	7,184
(÷) Outstanding Shares	15M
Fair Price	$487	+568.6%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	4.4x	6.4x	8.4x	10.4x	12.4x
5.2%	$414	$489	$565	$640	$715
6.2%	$387	$456	$524	$592	$661
7.2%	$363	$425	$487	$549	$612
8.2%	$340	$397	$454	$510	$567
9.2%	$319	$371	$423	$475	$526

Current price: $72.87. Green = undervalued, Red = overvalued.

Based on default parameters

Trading Multiples

Fair Value

$98.68

Market Price

$72.87

Upside / Downside

+35.4%

Verdict

Undervalued

Using the industry peer median P/E Multiples multiple (trailing + forward), Safety Insurance Group, Inc. (SAFT) has a fair value of $98.68 based on 10 comparable companies in the Insurance - Property & Casualty industry.

P/E Valuation — Insurance - Property & Casualty

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing P/E	Forward P/E
Safety Insurance Group, Inc.SAFT	1,074	10.9x	14.1x
Selective Insurance Group, Inc.SIGI	5,070	11.3x	23.3x
Peoples Bancorp Inc.PEBO	1,231	11.5x	9.7x
United Fire Group, Inc.UFCS	1,199	10.4x	23.4x
Universal Insurance Holdings, Inc.UVE	1,131	6.4x	22.8x
OceanFirst Financial Corp.OCFC	1,083	16.1x	11.9x
Ategrity Specialty Holdings LLCASIC	945	12.3x	129.8x
Bowhead Specialty Holdings Inc.BOW	889	17.0x	16.6x
Root, Inc.ROOT	798	25.4x	—
New Mountain Finance CorporationNMFC	782	59.1x	5.9x
Donegal Group Inc.DGICA	631	7.9x	43.6x
Industry Median		11.9x	22.8x
(*) Profit after tax		99	76
Equity Value		1,179	1,731
(/) Outstanding shares		15	15
Fair Price		$80	$117

Selected Fair Value (avg of trailing + forward)

$98.68

+35.4%

Fair Value

$63.82

Market Price

$72.87

Upside / Downside

-12.4%

Verdict

Overvalued

Using the industry peer median EV/EBITDA multiple (trailing + forward), Safety Insurance Group, Inc. (SAFT) has a fair value of $63.82 based on 10 comparable companies in the Insurance - Property & Casualty industry.

EV/EBITDA Valuation — Insurance - Property & Casualty

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/EBITDA	Forward EV/EBITDA
Safety Insurance Group, Inc.SAFT	1,074	8.3x	11.3x
Selective Insurance Group, Inc.SIGI	5,070	9.0x	10.3x
Peoples Bancorp Inc.PEBO	1,231	13.2x	18.8x
United Fire Group, Inc.UFCS	1,199	7.5x	8.8x
Universal Insurance Holdings, Inc.UVE	1,131	2.9x	2.3x
OceanFirst Financial Corp.OCFC	1,083	27.7x	48.2x
Ategrity Specialty Holdings LLCASIC	945	9.4x	10.6x
Bowhead Specialty Holdings Inc.BOW	889	9.2x	5.9x
Root, Inc.ROOT	798	4.2x	5.6x
New Mountain Finance CorporationNMFC	782	7.8x	7.7x
Donegal Group Inc.DGICA	631	6.3x	6.8x
Industry Median		8.4x	8.3x
(*) EBITDA		128	94
= Enterprise Value		1,079	779
(-) Net Debt		-12	-12
Equity Value		1,091	791
(/) Outstanding shares		15	15
Fair Price		$74	$54

Selected Fair Value (avg of trailing + forward)

$63.82

-12.4%

Fair Value

$86.27

Market Price

$72.87

Upside / Downside

+18.4%

Verdict

Undervalued

Using the industry peer median EV/Revenue multiple (trailing + forward), Safety Insurance Group, Inc. (SAFT) has a fair value of $86.27 based on 10 comparable companies in the Insurance - Property & Casualty industry.

EV/Revenue Valuation — Insurance - Property & Casualty

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/Revenue	Forward EV/Revenue
Safety Insurance Group, Inc.SAFT	1,074	0.8x	1.2x
Selective Insurance Group, Inc.SIGI	5,070	1.1x	1.3x
Peoples Bancorp Inc.PEBO	1,231	2.9x	4.1x
United Fire Group, Inc.UFCS	1,199	0.9x	1.0x
Universal Insurance Holdings, Inc.UVE	1,131	0.5x	0.4x
OceanFirst Financial Corp.OCFC	1,083	3.9x	6.9x
Ategrity Specialty Holdings LLCASIC	945	2.2x	2.4x
Bowhead Specialty Holdings Inc.BOW	889	1.2x	0.8x
Root, Inc.ROOT	798	0.2x	0.3x
New Mountain Finance CorporationNMFC	782	6.4x	6.3x
Donegal Group Inc.DGICA	631	0.7x	0.7x
Industry Median		1.2x	1.2x
(*) Revenue		1,254	919
= Enterprise Value		1,456	1,064
(-) Net Debt		-12	-12
Equity Value		1,468	1,076
(/) Outstanding shares		15	15
Fair Price		$100	$73

Selected Fair Value (avg of trailing + forward)

$86.27

+18.4%

PEG Fair Value

Fair Value

$53.60

Market Price

$72.87

Upside / Downside

-26.4%

Verdict

Overvalued

Using the PEG framework with historical EPS growth of 8.0% plus 5.0% dividend yield, the company has a fair value of $53.60 based on TTM EPS (FY2025) of $6.70.

PEG Ratio

PEG ratio unavailable — requires positive earnings and growth data.

Fair Value Calculation

EPS Growth RateHistorical	-6.6%
Dividend Yield	+5.0%
Adjusted Growth (clamped 8–25%)Clamped	8.0%
Fair P/E	8.0x
TTM EPS (FY2025)	$6.70
Fair Value	$53.60

Growth Analysis

Forward Growth

No analyst estimates available.

Historical GrowthActive

Year	Net Income	EPS	YoY
FY2021	$130.7M	$8.80	—
FY2022	$46.6M	$3.15	-64.2%
FY2023	$18.9M	$1.28	-59.4%
FY2024	$70.7M	$4.78	+273.4%
FY2025	$99.3M	$6.70	+40.2%

4Y Historical EPS CAGR: -6.6%

Earnings Power Value

Fair Value

$346.83

Market Price

$72.87

Upside / Downside

+376.0%

Verdict

Undervalued

Using the Earnings Power Value framework with a WACC of 7.2% and normalized earnings of $366.6M, the company has a fair value of $346.83 per share. The EPV range is $287.08 – $438.11 based on WACC sensitivity (5.7% – 8.7%).

Currency: USD Millions

	Low	Selected	High
Normalized Earnings	367	367	367
(/) WACC	8.7%	7.2%	5.7%
Enterprise Value	4,221	5,102	6,448
(-) Net debt	-12	-12	-12
Equity Value	4,233	5,114	6,460
(/) Outstanding shares	15	15	15
Fair Price	$287.08	$346.83	$438.11

Dividend Discount Model

Fair Value

$67.08

Market Price

$72.87

Upside / Downside

-7.9%

Verdict

Overvalued

Using the Two-Stage Dividend Discount Model with a Cost of Equity of 7.5% and projected dividend growth of 0.0%, the fair value is $67.08 per share. The DDM range is $48.08 – $122.38 based on sensitivity analysis across Cost of Equity and growth rate assumptions.

Dividend Profile

Current DPS

$3.65

Dividend Yield

5.03%

Payout Ratio

54.3%

Dividend Coverage

1.84x

FCF Payout Ratio28.1%

DPS CAGR (4Y)0.2%

Historical Dividends Per Share

Year	DPS	Payout Ratio	YoY Growth
2025	$3.65	54.3%	+0.8%
2024	$3.62	75.4%	+0.0%
2023	$3.62	282.3%	+0.5%
2022	$3.61	113.9%	-0.4%
2021	$3.62	41.3%	—

Dividend Projections (5-Year)

Year	Projected DPS	Growth	Discount Factor	Present Value
2026	$3.65	0.0%	0.9303	$3.40
2027	$3.65	0.0%	0.8655	$3.16
2028	$3.65	0.0%	0.8052	$2.94
2029	$3.65	0.0%	0.7491	$2.74
2030	$3.65	0.0%	0.6969	$2.55
Terminal Value	$3.74 DPS	2.5%		$52.30

PV of Projected Dividends$14.78

PV of Terminal Value$52.30

Fair Value per Share$67.08

Sensitivity Analysis

Fair value under different Cost of Equity (rows) and DPS Growth Rate (columns) assumptions.

Ke \ Growth	0.0%	0.0%	0.0%	1.0%	2.0%
5.5%	$111	$111	$111	$117	$122
6.5%	$84	$84	$84	$88	$92
7.5%	$67	$67	$67	$70	$73
8.5%	$56	$56	$56	$59	$61
9.5%	$48	$48	$48	$50	$52

Disclaimer: Sweet Value Lab provides estimated intrinsic values for informational purposes only. This is not financial advice. All models rely on assumptions that may not reflect future performance. Always do your own research before making investment decisions.

Safety Insurance Group, Inc. (SAFT) Valuation Summary

Updated May 11, 2026 10:32

Model	Range	Fair Value	Upside
▸ Discounted Cash Flow
Growth Exit 5Y	$367.18 – $1,563.81	$583.04	+700.1%
Growth Exit 10Y	$453.07 – $1,890.64	$714.55	+880.6%
EBITDA Exit 5Y	$233.30 – $554.29	$380.08	+421.6%
EBITDA Exit 10Y	$319.34 – $715.02	$487.16	+568.5%
▸ Trading Multiples
P/E	$70.32 – $114.56	$98.68	+35.4%
EV/EBITDA	$55.27 – $82.68	$63.82	-12.4%
EV/Revenue	$56.38 – $245.21	$86.27	+18.4%
▸ PEG
PEG Fair Value	$53.60 – $53.60	$53.60	-26.4%
▸ Earnings Power Value
Earnings Power Value	$287.08 – $438.11	$346.83	+376.0%
▸ Dividend Discount
Dividend Discount	$48.08 – $122.38	$67.08	-7.9%

Valuation History

DCF Analysis

Fair Value

$583.04

Market Price

$72.87

Upside / Downside

+700.1%

Verdict

Undervalued

FCFF Present Value Calculation

WACC

7.19%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	446	492	540	593	651	667
(−) Net Interest	1	1	1	1	2	2
(+) D&A	4	3	4	5	6	6
EBITDA	451	497	546	599	658	674

(−) Tax	96	106	117	128	140	144
(−) CapEx	6	6	7	7	8	8
(−) ΔWC	34	45	47	51	56	58
Free Cash Flow (FCFF)	315	339	376	413	453	464

Terminal Value						9,909
WACC / Discount Rate	7.2%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	304	306	316	324	332	7,004

Enterprise Value	8,585
Projection Period	1,581	18.4%
Terminal Value	7,004	81.6%

(−) Current Net Debt	(12)

Equity Value	8,597
(/) Outstanding Shares	15

Fair Price	$583.04

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.2%	$777	$881	$1024	$1232	$1564
6.2%	$608	$668	$743	$843	$979
7.2%	$500	$537	$583	$640	$712
8.2%	$423	$449	$479	$515	$559
9.2%	$367	$386	$407	$431	$460

Current price: $72.87. Green = undervalued, Red = overvalued.

Fair Value

$714.55

Market Price

$72.87

Upside / Downside

+880.6%

Verdict

Undervalued

FCFF Present Value Calculation

WACC

7.19%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	446	492	540	593	651	707	760	808	850	885	908
(−) Net Interest	1	1	1	1	2	2	2	2	2	2	2
(+) D&A	4	3	4	5	6	7	7	8	9	9	10
EBITDA	451	497	546	599	658	715	769	818	861	897	919

(−) Tax	96	106	117	128	140	153	164	174	184	191	196
(−) CapEx	6	6	7	7	8	9	9	10	11	11	11
(−) ΔWC	34	45	47	51	56	55	52	47	41	34	35
Free Cash Flow (FCFF)	315	339	376	413	453	499	544	586	626	661	677

Terminal Value											14,450
WACC / Discount Rate	7.2%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	304	306	316	324	332	341	346	348	347	342	7,219

Enterprise Value	10,524
Projection Period	3,305	31.4%
Terminal Value	7,219	68.6%

(−) Current Net Debt	(12)

Equity Value	10,536
(/) Outstanding Shares	15

Fair Price	$714.55

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.2%	$999	$1117	$1279	$1515	$1891
6.2%	$774	$838	$920	$1027	$1174
7.2%	$628	$667	$715	$773	$847
8.2%	$527	$553	$582	$618	$661
9.2%	$453	$470	$490	$513	$540

Current price: $72.87. Green = undervalued, Red = overvalued.

Fair Value

$380.15

Market Price

$72.87

Upside / Downside

+421.7%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Safety Insurance Group, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 10.4% to 9.7% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 142, DPO 54, DIO 10). At a 7.2% WACC with mid-year discounting, the terminal value (72% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 8.4x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $380.08 per share, suggesting SAFT is undervalued by 421.6% at the current price of $72.87.

FCFF Present Value Calculation

WACC

7.19%

3% – 20%

EV/EBITDA Exit Multiple

8.42x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	446	492	540	593	651	667
(−) Net Interest	1	1	1	1	2	2
(+) D&A	4	3	4	5	6	6
EBITDA	451	497	546	599	658	674

(−) Tax	96	106	117	128	140	—
(−) CapEx	6	6	7	7	8	—
(−) ΔWC	34	45	47	51	56	—
Free Cash Flow (FCF)	315	339	376	413	453	—

Peers' EBITDA Multiple						8.4x
Terminal Value						5,677
WACC / Discount Rate	7.19%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	304	306	316	324	332	4,013

Enterprise Value	5,593
Projection Period	1,581	28.3%
Terminal Value	4,013	71.7%

(−) Current Net Debt	(12)
Equity Value	5,605
(÷) Outstanding Shares	15M
Fair Price	$380	+421.7%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	4.4x	6.4x	8.4x	10.4x	12.4x
5.2%	$270	$341	$412	$483	$554
6.2%	$260	$328	$396	$463	$531
7.2%	$251	$315	$380	$445	$509
8.2%	$242	$304	$365	$427	$489
9.2%	$233	$292	$351	$410	$469

Current price: $72.87. Green = undervalued, Red = overvalued.

Based on default parameters

Fair Value

$487.23

Market Price

$72.87

Upside / Downside

+568.6%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Safety Insurance Group, Inc.'s cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from 10.4% to 4.1% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 142, DPO 54, DIO 10). At a 7.2% WACC with mid-year discounting, the terminal value (54% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 8.4x to Year 11 EBITDA. After subtracting net debt, the equity value implies a fair price of $487.16 per share, suggesting SAFT is undervalued by 568.5% at the current price of $72.87.

FCFF Present Value Calculation

WACC

7.19%

3% – 20%

EV/EBITDA Exit Multiple

8.42x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	446	492	540	593	651	707	760	808	850	885	908
(−) Net Interest	1	1	1	1	2	2	2	2	2	2	2
(+) D&A	4	3	4	5	6	7	7	8	9	9	10
EBITDA	451	497	546	599	658	715	769	818	861	897	919

(−) Tax	96	106	117	128	140	153	164	174	184	191	—
(−) CapEx	6	6	7	7	8	9	9	10	11	11	—
(−) ΔWC	34	45	47	51	56	55	52	47	41	34	—
Free Cash Flow (FCF)	315	339	376	413	453	499	544	586	626	661	—

Peers' EBITDA Multiple											8.4x
Terminal Value											7,741
WACC / Discount Rate	7.19%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	304	306	316	324	332	341	346	348	347	342	3,867

Enterprise Value	7,172
Projection Period	3,305	46.1%
Terminal Value	3,867	53.9%

(−) Current Net Debt	(12)
Equity Value	7,184
(÷) Outstanding Shares	15M
Fair Price	$487	+568.6%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	4.4x	6.4x	8.4x	10.4x	12.4x
5.2%	$414	$489	$565	$640	$715
6.2%	$387	$456	$524	$592	$661
7.2%	$363	$425	$487	$549	$612
8.2%	$340	$397	$454	$510	$567
9.2%	$319	$371	$423	$475	$526

Current price: $72.87. Green = undervalued, Red = overvalued.

Based on default parameters

Trading Multiples

Fair Value

$98.68

Market Price

$72.87

Upside / Downside

+35.4%

Verdict

Undervalued

P/E Valuation — Insurance - Property & Casualty

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing P/E	Forward P/E
Safety Insurance Group, Inc.SAFT	1,074	10.9x	14.1x
Selective Insurance Group, Inc.SIGI	5,070	11.3x	23.3x
Peoples Bancorp Inc.PEBO	1,231	11.5x	9.7x
United Fire Group, Inc.UFCS	1,199	10.4x	23.4x
Universal Insurance Holdings, Inc.UVE	1,131	6.4x	22.8x
OceanFirst Financial Corp.OCFC	1,083	16.1x	11.9x
Ategrity Specialty Holdings LLCASIC	945	12.3x	129.8x
Bowhead Specialty Holdings Inc.BOW	889	17.0x	16.6x
Root, Inc.ROOT	798	25.4x	—
New Mountain Finance CorporationNMFC	782	59.1x	5.9x
Donegal Group Inc.DGICA	631	7.9x	43.6x
Industry Median		11.9x	22.8x
(*) Profit after tax		99	76
Equity Value		1,179	1,731
(/) Outstanding shares		15	15
Fair Price		$80	$117

Selected Fair Value (avg of trailing + forward)

$98.68

+35.4%

Fair Value

$63.82

Market Price

$72.87

Upside / Downside

-12.4%

Verdict

Overvalued

EV/EBITDA Valuation — Insurance - Property & Casualty

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/EBITDA	Forward EV/EBITDA
Safety Insurance Group, Inc.SAFT	1,074	8.3x	11.3x
Selective Insurance Group, Inc.SIGI	5,070	9.0x	10.3x
Peoples Bancorp Inc.PEBO	1,231	13.2x	18.8x
United Fire Group, Inc.UFCS	1,199	7.5x	8.8x
Universal Insurance Holdings, Inc.UVE	1,131	2.9x	2.3x
OceanFirst Financial Corp.OCFC	1,083	27.7x	48.2x
Ategrity Specialty Holdings LLCASIC	945	9.4x	10.6x
Bowhead Specialty Holdings Inc.BOW	889	9.2x	5.9x
Root, Inc.ROOT	798	4.2x	5.6x
New Mountain Finance CorporationNMFC	782	7.8x	7.7x
Donegal Group Inc.DGICA	631	6.3x	6.8x
Industry Median		8.4x	8.3x
(*) EBITDA		128	94
= Enterprise Value		1,079	779
(-) Net Debt		-12	-12
Equity Value		1,091	791
(/) Outstanding shares		15	15
Fair Price		$74	$54

Selected Fair Value (avg of trailing + forward)

$63.82

-12.4%

Fair Value

$86.27

Market Price

$72.87

Upside / Downside

+18.4%

Verdict

Undervalued

EV/Revenue Valuation — Insurance - Property & Casualty

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/Revenue	Forward EV/Revenue
Safety Insurance Group, Inc.SAFT	1,074	0.8x	1.2x
Selective Insurance Group, Inc.SIGI	5,070	1.1x	1.3x
Peoples Bancorp Inc.PEBO	1,231	2.9x	4.1x
United Fire Group, Inc.UFCS	1,199	0.9x	1.0x
Universal Insurance Holdings, Inc.UVE	1,131	0.5x	0.4x
OceanFirst Financial Corp.OCFC	1,083	3.9x	6.9x
Ategrity Specialty Holdings LLCASIC	945	2.2x	2.4x
Bowhead Specialty Holdings Inc.BOW	889	1.2x	0.8x
Root, Inc.ROOT	798	0.2x	0.3x
New Mountain Finance CorporationNMFC	782	6.4x	6.3x
Donegal Group Inc.DGICA	631	0.7x	0.7x
Industry Median		1.2x	1.2x
(*) Revenue		1,254	919
= Enterprise Value		1,456	1,064
(-) Net Debt		-12	-12
Equity Value		1,468	1,076
(/) Outstanding shares		15	15
Fair Price		$100	$73

Selected Fair Value (avg of trailing + forward)

$86.27

+18.4%

PEG Fair Value

Fair Value

$53.60

Market Price

$72.87

Upside / Downside

-26.4%

Verdict

Overvalued

Using the PEG framework with historical EPS growth of 8.0% plus 5.0% dividend yield, the company has a fair value of $53.60 based on TTM EPS (FY2025) of $6.70.

PEG Ratio

PEG ratio unavailable — requires positive earnings and growth data.

Fair Value Calculation

EPS Growth RateHistorical	-6.6%
Dividend Yield	+5.0%
Adjusted Growth (clamped 8–25%)Clamped	8.0%
Fair P/E	8.0x
TTM EPS (FY2025)	$6.70
Fair Value	$53.60

Growth Analysis

Forward Growth

No analyst estimates available.

Historical GrowthActive

Year	Net Income	EPS	YoY
FY2021	$130.7M	$8.80	—
FY2022	$46.6M	$3.15	-64.2%
FY2023	$18.9M	$1.28	-59.4%
FY2024	$70.7M	$4.78	+273.4%
FY2025	$99.3M	$6.70	+40.2%

4Y Historical EPS CAGR: -6.6%

Earnings Power Value

Fair Value

$346.83

Market Price

$72.87

Upside / Downside

+376.0%

Verdict

Undervalued

Currency: USD Millions

	Low	Selected	High
Normalized Earnings	367	367	367
(/) WACC	8.7%	7.2%	5.7%
Enterprise Value	4,221	5,102	6,448
(-) Net debt	-12	-12	-12
Equity Value	4,233	5,114	6,460
(/) Outstanding shares	15	15	15
Fair Price	$287.08	$346.83	$438.11

Dividend Discount Model

Fair Value

$67.08

Market Price

$72.87

Upside / Downside

-7.9%

Verdict

Overvalued

Dividend Profile

Current DPS

$3.65

Dividend Yield

5.03%

Payout Ratio

54.3%

Dividend Coverage

1.84x

FCF Payout Ratio28.1%

DPS CAGR (4Y)0.2%

Historical Dividends Per Share

Year	DPS	Payout Ratio	YoY Growth
2025	$3.65	54.3%	+0.8%
2024	$3.62	75.4%	+0.0%
2023	$3.62	282.3%	+0.5%
2022	$3.61	113.9%	-0.4%
2021	$3.62	41.3%	—

Dividend Projections (5-Year)

Year	Projected DPS	Growth	Discount Factor	Present Value
2026	$3.65	0.0%	0.9303	$3.40
2027	$3.65	0.0%	0.8655	$3.16
2028	$3.65	0.0%	0.8052	$2.94
2029	$3.65	0.0%	0.7491	$2.74
2030	$3.65	0.0%	0.6969	$2.55
Terminal Value	$3.74 DPS	2.5%		$52.30

PV of Projected Dividends$14.78

PV of Terminal Value$52.30

Fair Value per Share$67.08

Sensitivity Analysis

Fair value under different Cost of Equity (rows) and DPS Growth Rate (columns) assumptions.

Ke \ Growth	0.0%	0.0%	0.0%	1.0%	2.0%
5.5%	$111	$111	$111	$117	$122
6.5%	$84	$84	$84	$88	$92
7.5%	$67	$67	$67	$70	$73
8.5%	$56	$56	$56	$59	$61
9.5%	$48	$48	$48	$50	$52