Stock fact sheet · data as of
Mercury General Corporation (MCY): fair value, margin of safety and Wheel Score
Ticker symbol MCY · Financial Services · Insurance - Property & Casualty · United States · Blend
Is MCY undervalued?
MCY has a margin of safety of 69%: the stock closed at 88.93 on 5 Nov 2026 against a GLS average fair value of 289.08. 7 of the 9 valuation models that produced a number sit above the price. Our scans treat a discount this large as a strong starting point for a cash-secured put, not as a verdict - the fair value is a model output, and a wide gap can mean the models are missing something the market knows.
There is a wide gap between DDM (18.69) and Payback Time (827.02). When the models are this far apart the "fair value" is really a range, and the margin of safety above should be read with that range in mind.
Ranked against every other company we cover, neither cheapness nor growth clearly wins for MCY, so the nightly engine files it under Blend (value score 73, growth score 72, out of 100).
Nine valuation models for MCY
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 90.78 | +2% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 114.99 | +29% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 187.23 | +111% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 46.42 | -48% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 710.45 | +699% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 477.19 | +437% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 827.02 | +830% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | 18.69 | -79% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 128.94 | +45% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | -80.81 | -191% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 90.00 | +1% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Mercury General Corporation scores 6 of 9 on the Piotroski F-score: a middling result that passes the "Piotroski 6 or more" Wheel Trade Filter. Some of the nine tests on profitability, leverage and efficiency are failed, so the accounts are worth a look before selling a put on the name. On durability MCY scores 6.1/10 on the GLS Moat - a middle reading; the Moat Score tab on the Quote page's Financials view shows which of the four parts hold it back.
Returns on capital are high - ROIC 18.0%, ROE 22.4%, ROA 5.7% - with debt at 0.24 times equity and a free-cash-flow yield of 23.5%.
The dividend yield is 1.43% with a payout ratio of 11% - a small yield that leaves most of the earnings in the business.
Institutional ownership scores 6/10, insider activity 10/10 and Congressional trading 5/10 on the GLS smart-money scales.
| Piotroski F-score | 6 / 9 | ROIC | 18.0% |
|---|---|---|---|
| GLS Moat | 6.1 / 10 | ROE | 22.4% |
| Debt / equity | 0.24 | ROA | 5.7% |
| Free-cash-flow yield | 23.5% | Payout ratio | 11% |
| Institutions | 6 / 10 | Insiders · Congress | 10 · 5 / 10 |
Wheel Score 78: Good
With a Wheel Score of 78 - the Good band - Mercury General Corporation passes all 9 Wheel Trade Filters. How it ranks: value strong, premium good, moat good, health good, red flags fair, option trading fair, stability good. Option trading (fair) is the part keeping it out of the Prime band.
Implied volatility is 32% on the near-the-money contracts 20-60 days out: enough to pass the 25-80% Wheel Trade Filter, but under the 35-60% sweet spot the score rewards most. Chain open interest is 4,507 contracts across all expiries - enough for the wheel at normal size.
Volume runs at 851k shares a day on a market cap of $4.9B, with a beta of 0.94; the Stability part of the Wheel Score rates that good.
| Filter | Wheel Trade Filter | Result | Detail |
|---|---|---|---|
| 1 | Options that actually trade | Passes | Listed options with 1,000+ contracts of open interest and 100+ traded a day |
| 2 | A real business, not a gamble | Passes | Profitable over the last twelve months - not a speculative stock, fund or note |
| 3 | Below fair value | Passes | Trading below the nine-model average fair value (margin of safety above 0) |
| 4 | Financially healthy | Passes | Piotroski F-score 6 or more out of 9 (a company with no score on file passes) |
| 5 | Can repay its debt | Passes | Long-term debt repaid from 3 years of operating cash flow or less (6 for real estate and utilities; banks and insurers are not judged on it) |
| 6 | No serious red flags | Passes | Red Flags score 60 or more out of 100 (earnings, margins, debt, analysts, filings and price checked the same way for every stock) |
| 7 | A premium worth selling | Passes | Implied volatility 25-80% (enough premium, not a lottery ticket) |
| 8 | Big enough | Passes | Market cap $1 billion or more |
| 9 | Not a penny stock | Passes | Share price $5 or more |
| How it ranks | Rating | From | |
|---|---|---|---|
| Value | Strong | 69% below fair value | |
| Premium | Good | implied volatility 32% | |
| Moat | Good | moat 6.1/10 | |
| Health | Good | Piotroski 6/9 | |
| Red Flags | Fair | Red Flags score 75/100 | |
| Option trading | Fair | 3,007 contracts a day, 4,507 open interest | |
| Stability | Good | beta 0.94, $4.9B company |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls: a stock must pass all 9 Wheel Trade Filters to score 70, and the score then ranks the ones that pass; the Sunday Scan is the top 10. It is updated nightly and is not a recommendation. How the Wheel Score works · the walkthrough lesson shows how it fits into a trade, start to finish.
Upcoming events
No upcoming earnings date is recorded for MCY in the nightly calendar.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Insurance - Property & Casualty
The 12 companies below are the closest to Mercury General Corporation by market cap within the Insurance - Property & Casualty industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| ARX Accelerant Holdings | 19.85 | 5.94 | -234% | 33Weak | $4.3B |
| SIGIP Selective Insurance Group, Inc. | 14.99 | 101.31 | +85% | 37No options | $5.9B |
| SIGI Selective Insurance Group, Inc. | 103.20 | 220.39 | +53% | 43Weak | $6.1B |
| RLI RLI Corp. | 68.91 | 77.16 | +11% | 36Weak | $6.3B |
| PLMR Palomar Holdings, Inc. | 144.04 | 246.53 | +42% | 49Weak | $3.8B |
| HGTY Hagerty, Inc. | 18.71 | 24.70 | +24% | 43Weak | $6.4B |
| LMND Lemonade, Inc. | 45.90 | 4.31 | -964% | 23Weak | $3.6B |
| SLDE Slide Insurance Holdings, Inc. Common Stock | 27.28 | 96.94 | +72% | 82Good | $3.2B |
| AFSIM AmTrust Financial Services, Inc. | 14.70 | 1,681,551.22 | +100% | 33No options | $3.1B |
| AFFS AmTrust Financial Services, Inc. | 15.20 | 1,681,551.45 | +100% | 34No options | $3.0B |
| AFFT AmTrust Financial Services Inc 7.5 % Notes 2015-15.9.55 | 15.30 | 1,681,551.52 | +100% | 26No options | $3.0B |
| AFSIC AmTrust Financial Services, Inc. | 15.00 | 1,681,551.45 | +100% | 33No options | $3.0B |
⚖ Compare MCY with 7 of them All Financial Services stocks →
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Start free See the Sunday ScanQuestions about MCY
Is MCY undervalued right now?
By the GLS models, yes: at 88.93 the stock is 69% below the average fair value of 289.08 (data as of 5 Nov 2026). Whether the discount is deserved is the question to research next.
What is the Wheel Score of MCY and what does it mean?
MCY scores 78 out of 100 (Good). The Wheel Score ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned - in two parts: the 9 pass/fail Wheel Trade Filters (busy options, a real business, below fair value, Piotroski 6 or more, debt it can repay, a Red Flags score of 60 or more, implied volatility of 25-80%, a $1 billion company, $5 a share) and a ranking of how strongly a stock passes on value, premium, moat, health, red flags, option trading and stability. A stock that fails any filter stays under 70; 70-84 is Good, 85 and above is Prime. The Sunday Scan is the top 10 that pass, sorted by Wheel Score.
What is the GLS fair value for MCY?
289.08 per share as of 5 Nov 2026 - the simple average of the 9 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Mercury General Corporation report earnings next?
No upcoming earnings date is recorded for MCY in our calendar as of 5 Nov 2026; the Calendars page is refreshed every morning.
Does MCY have listed options, and how liquid are they?
Yes. The nightly snapshot found 64 listed contracts with 4,507 open interest across all expiries and implied volatility of 32% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.