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Markel (MKL) Q4 Earnings and Revenues Surpass Estimates
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Markel Corporation (MKL - Free Report) reported fourth-quarter 2021 earnings of $16.53 per share, which beat the Zacks Consensus Estimate by 5.2%. Moreover, the bottom line increased 4.4% year over year.
The company witnessed higher premiums at Insurance and Reinsurance Segments and increased profit at Markel Ventures, which were partially offset by higher expenses and lower net investment income.
Markel Corporation Price, Consensus and EPS Surprise
For 2021, Markel reported a net income of $176.51 per share, which increased three-fold year over year.
Total operating revenues of $10.86 billion beat the consensus mark by 1.4% and also improved nearly 19.2% year over year.
The combined ratio improved 800 basis points (bps) on a year-over-year basis to 90% in the quarter under review.
Quarterly Operational Update
Total operating revenues of $2.9 billion beat the Zacks Consensus Estimate by 6.1%. The top line rose 17.9% year over year on higher premiums, products revenues services and other revenues, partly offset by lower net investment income.
Net written premiums increased 25.8% year over year to $1.8 billion, primarily driven by higher premiums at the Insurance segment and Reinsurance segment.
Net investment income declined 7.2% year over year to $90.5 million in the fourth quarter.
Total operating expenses of Markel increased 16.7% year over year to $2.58 billion, primarily due to higher losses and loss adjustment expenses, underwriting, acquisition and insurance expenses, products expenses, services and other expenses and amortization of intangible assets.
Markel’s combined ratio improved 100 basis points (bps) year over year to 88% in the reported quarter.
Segment Update
Insurance: Net written premiums were up 21.5% year over year to $1.57 billion in the quarter under review.
Underwriting profit came in at $227.4 million, which increased 37.5% year over year.
The combined ratio improved 200 bps year over year to 85% in the quarter under discussion.
Reinsurance: Net written premiums increased 67% year over year to $233 million.
Underwriting profit came in at $3.4 million, which decreased 66% year over year.
The combined ratio deteriorated 300 bps year over year to 99% in the fourth quarter.
Markel Ventures: Profit of $57.4 million increased 7.8% year over year.
Financial Update
Markel exited the fourth quarter with investments, cash and cash equivalents and restricted cash and cash equivalents (invested assets) of $28.3 billion as of Dec 31, 2021, up 13.6% year over year. The increase was attributable to cash provided by operating, as well as an increase in the fair value of equity securities.
The debt balance increased 25.2% year over year to $4.36 billion as of Dec 31, 2021.
Book value per share increased 16.8% from year-end 2020 to $1,034.56 as of Dec 31, 2021.
Net cash from operating activities was $2.3 billion in 2021, up 35.3% year over year. The increase was due to higher net premium collections. It was partially offset by higher claims settlement activity due to continued growth in premium volume within the Insurance segment.
Of the insurance industry players who have reported fourth-quarter results so far, The Travelers Companies (TRV - Free Report) , RenaissanceRe Holdings Ltd. (RNR - Free Report) and The Progressive Corporation (PGR - Free Report) beat the Zacks Consensus Estimate for earnings.
Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and increased 6% year over year. Total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion.
Travelers’ net written premiums increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 bps year over year to 88.
RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from the year-ago loss of $1.59. Total revenues of $1.39 billion dipped 0.1% year over year.
RenaissanceRe’s gross premiums written surged 40.4% year over year to $1.3 billion. The combined ratio improved 3530 bps year over year to 79.4.
Progressive’s earnings of $1.05 per share beat the Zacks Consensus Estimate of 99 cents but declined 43.2% from the year-ago quarter.
Progressive’s net premiums written were $10.7 billion in the quarter, up 13% from $9.5 billion a year ago. The combined ratio deteriorated 630 bps from the prior-year quarter to 94.7.
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Markel (MKL) Q4 Earnings and Revenues Surpass Estimates
Markel Corporation (MKL - Free Report) reported fourth-quarter 2021 earnings of $16.53 per share, which beat the Zacks Consensus Estimate by 5.2%. Moreover, the bottom line increased 4.4% year over year.
The company witnessed higher premiums at Insurance and Reinsurance Segments and increased profit at Markel Ventures, which were partially offset by higher expenses and lower net investment income.
Markel Corporation Price, Consensus and EPS Surprise
Markel Corporation price-consensus-eps-surprise-chart | Markel Corporation Quote
Full-Year Highlights
For 2021, Markel reported a net income of $176.51 per share, which increased three-fold year over year.
Total operating revenues of $10.86 billion beat the consensus mark by 1.4% and also improved nearly 19.2% year over year.
The combined ratio improved 800 basis points (bps) on a year-over-year basis to 90% in the quarter under review.
Quarterly Operational Update
Total operating revenues of $2.9 billion beat the Zacks Consensus Estimate by 6.1%. The top line rose 17.9% year over year on higher premiums, products revenues services and other revenues, partly offset by lower net investment income.
Net written premiums increased 25.8% year over year to $1.8 billion, primarily driven by higher premiums at the Insurance segment and Reinsurance segment.
Net investment income declined 7.2% year over year to $90.5 million in the fourth quarter.
Total operating expenses of Markel increased 16.7% year over year to $2.58 billion, primarily due to higher losses and loss adjustment expenses, underwriting, acquisition and insurance expenses, products expenses, services and other expenses and amortization of intangible assets.
Markel’s combined ratio improved 100 basis points (bps) year over year to 88% in the reported quarter.
Segment Update
Insurance: Net written premiums were up 21.5% year over year to $1.57 billion in the quarter under review.
Underwriting profit came in at $227.4 million, which increased 37.5% year over year.
The combined ratio improved 200 bps year over year to 85% in the quarter under discussion.
Reinsurance: Net written premiums increased 67% year over year to $233 million.
Underwriting profit came in at $3.4 million, which decreased 66% year over year.
The combined ratio deteriorated 300 bps year over year to 99% in the fourth quarter.
Markel Ventures: Profit of $57.4 million increased 7.8% year over year.
Financial Update
Markel exited the fourth quarter with investments, cash and cash equivalents and restricted cash and cash equivalents (invested assets) of $28.3 billion as of Dec 31, 2021, up 13.6% year over year. The increase was attributable to cash provided by operating, as well as an increase in the fair value of equity securities.
The debt balance increased 25.2% year over year to $4.36 billion as of Dec 31, 2021.
Book value per share increased 16.8% from year-end 2020 to $1,034.56 as of Dec 31, 2021.
Net cash from operating activities was $2.3 billion in 2021, up 35.3% year over year. The increase was due to higher net premium collections. It was partially offset by higher claims settlement activity due to continued growth in premium volume within the Insurance segment.
Zacks Rank & Performance of Other Insurers
Markel currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Some P&C Insurers
Of the insurance industry players who have reported fourth-quarter results so far, The Travelers Companies (TRV - Free Report) , RenaissanceRe Holdings Ltd. (RNR - Free Report) and The Progressive Corporation (PGR - Free Report) beat the Zacks Consensus Estimate for earnings.
Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and increased 6% year over year. Total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion.
Travelers’ net written premiums increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 bps year over year to 88.
RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from the year-ago loss of $1.59. Total revenues of $1.39 billion dipped 0.1% year over year.
RenaissanceRe’s gross premiums written surged 40.4% year over year to $1.3 billion. The combined ratio improved 3530 bps year over year to 79.4.
Progressive’s earnings of $1.05 per share beat the Zacks Consensus Estimate of 99 cents but declined 43.2% from the year-ago quarter.
Progressive’s net premiums written were $10.7 billion in the quarter, up 13% from $9.5 billion a year ago. The combined ratio deteriorated 630 bps from the prior-year quarter to 94.7.