Revenue
$4.1Blow FY2016
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ERIE, Erie Indemnity Company
Insurance Brokers financial
Erie Indemnity Company is a publicly held Pennsylvania business corporation that has since its incorporation in 1925 served as the attorney-in-fact for the subscribers at the Erie Insurance Exchange.
Our primary function as attorney-in-fact is to perform policy issuance and renewal services on behalf of the subscribers at the Exchange.
The business
What it sells, where the money comes from, the kind of company it is.
Revenue · FY2025
$4.1B
+7.2% YoY · 10% 5-yr CAGR
Vital signs · TTM, with 5-yr average
Revenue $4.1B 5-yr avg $3.3B
Net margin 14.0% 5-yr avg 13.0%
Revenue $1.0B +2.3% vs yr-ago qtr
Operating margin 16.5% yr-ago 15.3%
Net income $150M yr-ago $138M
Net margin 14.9% yr-ago 14.0%
The business in brief
read the 10-K →What this business is and what moves its needle, from its own SEC filings.
- What it is
- Revenue is Policy Issuance and Renewal Services (77%), Administrative Services Reimbursements (21%) and Administrative Services Management Fee (2%).
- What moves the needle
- Commissions on the premiums it places, and organic growth. What decides it: insurance prices in the market, since it earns a slice of them; new business won and kept; and a capital-light fee stream that carries none of the underwriting risk of the insurers it sells for. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
- Is it a good business?
- Operating margin has been modest for a fee business (median 15%). It earns this on little capital, so return on equity has run near 25%, the leverage of a model that needs almost no plant to grow. A high return that does not fade can mark a moat, but whether the commissions keep renewing as rates turn is what the 10-K settles, not the multiple.
Every line is arithmetic on the company's filings, shown in full in the sections below.
Where the money comes from
read the 10-K →Policy Issuance and Renewal Services is 77% of revenue, with Administrative Services Reimbursements the other meaningful line at 21%.
Revenue by product line, FY2025
- Policy Issuance and Renewal Services77%$3.1B
- Administrative Services Reimbursements21%$837M
- Administrative Services Management Fee2%$74M
- Rental Income1%$25M
From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.
The record
Ten years of arithmetic, read across the cycle.
The record, 2016–2025
realized figures from each filing · older years to the left| 2016’16 | 2017’17 | 2018’18 | 2019’19 | 2020’20 | 2021’21 | 2022’22 | 2023’23 | 2024’24 | 2025’25 | TTMTTMMar 2026 | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Income statement | |||||||||||
| $1.6B | $1.7B | $2.4B | $2.5B | $2.5B | $2.6B | $2.8B | $3.3B | $3.8B | $4.1B | $4.1B | RevenueRevenue |
| 18.4% | 17.2% | 14.5% | 14.4% | 13.3% | 12.1% | 13.2% | 15.9% | 17.8% | 17.6% | 17.9% | Operating marginOp. mgn |
| 13.2% | 11.6% | 12.1% | 12.8% | 11.6% | 11.3% | 10.5% | 13.6% | 15.8% | 13.8% | 14.0% | Net marginNet mgn |
| $210M | $197M | $288M | $317M | $293M | $298M | $299M | $446M | $600M | $559M | $571M | Net incomeNet inc. |
| 34% | 38% | 22% | 20% | 20% | 21% | 21% | 21% | 21% | 21% | 21% | Effective tax rateTax rate |
| Cash flow & returns | |||||||||||
| $239M | $182M | $250M | $348M | $321M | $366M | $320M | $334M | $555M | $617M | $591M | Owner earningsOwner earn. |
| 26% | 23% | 30% | 28% | 25% | 22% | 21% | 27% | 30% | 24% | 24% | Return on equityROE |
| 9% | 6% | 14% | 13% | 2% | 8% | 6% | 13% | 18% | 13% | 13% | Retained to equityRetained/eq |
| Balance sheet | |||||||||||
| $1.5B | $1.7B | $1.8B | $2.0B | $2.1B | $2.2B | $2.2B | $2.5B | $2.9B | $3.4B | $3.4B | Total assetsAssets |
| $902M | $974M | $266M | $337M | $161M | $184M | $142M | $144M | $298M | $346M | $1.0B | Cash & investmentsCash+inv |
| $817M | $857M | $974M | $1.1B | $1.2B | $1.3B | $1.4B | $1.7B | $2.0B | $2.3B | $2.4B | Shareholders’ equityEquity |
The record, charted
FY2016–2025Each measure over its full record; the current point and the worst year marked.
Quality & stewardship
Returns, the balance sheet, capital allocation, and pay.
Owner’s Scorecard
FY2025 10-K · source on SEC EDGAR →
Is it a good business?
- Operating margin 17.6%Modest fee marginOperating income $717M ÷ revenue $4.1BIndustry peers: median 12%
What this means
The heart of a insurance broker: how much of each fee dollar survives the cost of running the business. Commissions are a slice of the premiums it places, earned without taking the underwriting risk itself, so it is a capital-light fee stream that rises with new business, retention and the price of insurance. A high margin held for years, through a market it does not control, is the operational mark of a real franchise.
- Net margin 13.8%SolidNet income $559M ÷ revenue $4.1B
What this means
What reaches the owner after tax and interest. For a capital-light fee business this should be a wide share of revenue; when it is thin despite a high operating margin, debt taken on for acquisitions is usually the reason, so read it next to the balance sheet.
- Return on equity 24%StrongNet income $559M ÷ equity $2.3BIndustry peers: median 11%
What this means
Because the business ties up little capital, a healthy fee stream throws off a high return on the equity behind it. Read it with the buyback record: returning capital lifts this ratio honestly, but heavy debt taken to do so can flatter it.
Does AI threaten the moat?
Low contestabilityThe moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.
In its own filing Named as a competitive risk
Its FY2025 10-K names artificial intelligence as a competitive threat.
“Innovations, including the use of artificial intelligence and machine learning to support underwriting or other decisions, by competitors or other market participants may increase the level of competition in the industry.”
AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.
Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.
All figures as filed; the source filing is linked above.
Current Position
as of the latest quarter, Mar 31, 2026Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.
Current assets$1.2B
- Cash & short-term investments$340M
- Receivables$743M
- Other current assets$78M
Current liabilities$900M
- Accounts payable$229M
- Other current liabilities$670M
Current ratio1.29×all current assets ÷ what's due · Graham looked for 2×
Quick ratio1.29×stricter: inventory excluded
Cash ratio0.38×strictest: cash alone against what's due
Working capital$261Mthe cushion left after near-term bills
Revenue, latest quarter vs. a year ago+2.3%the freshest read on whether the business is still growing
Current ratio, recent quarters1.3× → 1.3×
Deeper floors
Tangible book value$2.3Bequity stripped of goodwill & intangibles
Net current asset value$138MGraham's net-net: current assets less all liabilities
Debt incl. operating leases$23M$23M of it operating leases
Deferred revenue$70Mcustomer cash collected before delivery; operating float
From the company's latest filing.
Peers, Insurance Brokers
The same industry, side by side on fee margins. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.
| Company | Revenue | Op. margin | Net margin | ROE |
|---|---|---|---|---|
| AONAon PLC | $17.2B | 22.1% | 15.9% | 41% |
| AJGArthur J. Gallagher & Co. | $13.9B | 11.8% | 10.2% | 11% |
| EQHEquitable Holdings Inc. | $11.7B | 11.4% | 10.5% | 13% |
| WTWWillis Towers Watson PLC | $9.5B | 11.4% | 11.5% | 10% |
| BROBrown & Brown Inc. | $5.9B | 26.7% | 18.6% | 13% |
| ERIEErie Indemnity Company | $4.1B | 15.2% | 12.4% | 25% |
| RYANRyan Specialty Holdings Inc. | $3.0B | 16.5% | 3.9% | 11% |
| BWINThe Baldwin Insurance Group Inc. | $1.5B | -3.2% | -4.3% | -6% |
| Group median | — | 13.5% | 11.0% | 12% |
The price
What a price has to assume.
What the price implies
reverse-DCFType today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Erie Indemnity Company has delivered.
$
Through the cycle, Erie Indemnity Company earns about $540M on its 13.3% median owner-earnings margin. This year’s 15.2% margin runs in line with that. Normalize, below, values the price on that through-cycle figure rather than the latest year.
Base
—
The assumptions
9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.
Enter a price above to run it.
A dated snapshot of the price you typed, the assumptions you set, and what the page showed for them. A snapshot is never edited after it is saved. Your notebook is yours alone — the commitment states what is stored and what we will never do.
Implied by the price—
Owner-earnings growth · ’21→’25+14%/yr
Owner-earnings growth · ’16→’25+11%/yr
Owner-earnings growth · ’16→’25+12%/yr
Owner-earnings yield—
What a growth belief costs, in multiples
The growth each return requires, at your price
P/E (3-yr earnings ’23–’25)—
P/B—
Graham’s price gate—
Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.
Against a high-grade bond: Graham’s yardstick bond yield%
Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.
Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.
Owner-earnings yield—
High-grade bond yield—
Margin over the bond—
Free cash flow $537M on 0M diluted shares; net cash $1.0B. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. Capex ($123M) runs well above depreciation ($69M), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $591M, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.
Cite: Owner Scorecard, "Erie Indemnity Company (ERIE), the owner's record," https://ownerscorecard.com/c/ERIE, data as of 2026-07-09.
Manual order: ← EQT its page in the Manual ERII →
Industry order: ← EQH the Insurance Brokers chapter GSHD →