Mercury General Corporation (MCY) - Stock Analysis
Last updated: Jan 13, 2026
Research Idea
Research content for general circulation. Not individualized advice. Methodology & Disclosures
Mercury General reported a 166% surge in net income with improved underwriting and cost structures, shares approaching 52-week highs supported by favorable industry underwriting cycles and technical indicators showing proximity to upper Bollinger Band, indicating strong short-term price momentum.
Loading chart data...
AI Analyst Overview
Loading chart data...
Valuation Metrics
Fundamental Analysis
Key Financial Insights: ⢠Margin expansion ⢠Strong FCF ⢠Low leverage MCY's margins and free cash flow have materially improved with low leverage and strong liquidity, but rising valuation multiples and sizable deferred revenue are the main risks to monitor.
Price Behavior
Key Price Behavior Insights: ⢠Range-bound trading ⢠Resistance near $94 ⢠Support $88â$89 Support Level: $88â$89 Resistance Level: $94 Over the last month MCY has traded range-bound, with resistance near $94 and support around $88â$89 as it struggles to sustain momentum above $90, implying a neutral bias until a clear break above $94 or below $88.
Sentiment & News
Key News Insights: ⢠Rising premiums ⢠Seasonal guidance ⢠Q4 earnings Mercury General's rising premiums, strong P&C performance and investment income have driven momentum and near-52-week highs while the company simultaneously promotes seasonal risk-mitigation ahead of its midâFebruary Q4 2025 results.
AI Summary
MCY has legitimately re-rated from a cheap cyclical P&C to a higherâquality, cashâgenerative specialty insurerâdriven by lower combined ratios and strong FCFâbut that reârating materially reduces margin of safety so future returns hinge on sustaining underwriting discipline and managing reinsurance/catastrophe volatility (watch combined ratio trends, reinsurance reinstatement costs, and a decisive close above $94).
Description
Mercury General Corporation underwrites primarily personal automobile insurance across multiple U.S. states and also offers homeowners, commercial property and automobile, mechanical protection and umbrella coverages. The company distributes policies through a network of independent agents and agencies and sells directly via online portals in selected states, including California, Texas, Florida and New York. Founded in 1961, Mercury General is headquartered in Los Angeles, California.
Idea History
| Date | Close | Ticker | Company | Summary | Status | P/L |
|---|---|---|---|---|---|---|
| Sep 8 | Sep 15 | MCY | Mercury General Corporation | Mercury General reported a 166% surge in net income with improved underwriting and cost structures, shares approaching 52-week highs supported by favorable industry underwriting cycles and technical indicators showing proximity to upper Bollinger Band, indicating strong short-term price momentum. | Closed | +1.5% |