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Is a Beat in Store for Arch Capital (ACGL) in Q4 Earnings?
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Arch Capital Group Ltd. (ACGL - Free Report) is slated to report fourth-quarter 2023 earnings on Feb 14, after market close. The insurer delivered an earnings surprise in each of the last four quarters, the average beat being 26.83%.
Factors to Consider
Growth in new business as well as in existing accounts and rate increases in the Insurance and Reinsurance segments are likely to have favored net premiums earned.
The Zacks Consensus Estimate for net premiums earned is pegged at $3.4 billion, indicating an increase of 22.5% from the year-ago reported figure. We expect net premiums earned to increase 19.9% to $3.3 billion.
Net investment income is likely to have benefited from increased rates and a wider investment base. We expect net investment income to increase 106.2% to $265.3 million. The Zacks Consensus Estimate for investment income is pegged at $303.2 million, indicating a 55.2% increase from the year-ago reported figure.
The top line is likely to have benefited from improved earned premiums and higher net investment income. The Zacks Consensus Estimate for revenues is pegged at $3.7 billion, indicating an increase of 24.3% from the year-ago reported figure.
Expenses are expected to have increased on higher losses and loss adjustment expenses, acquisition costs and other operating expenses. We expect total expenses to increase 30.8% to $2.9 billion.
Underwriting profitability is likely to have benefited from rate increases and a balanced business mix. However, higher loss and loss adjustment expenses are likely to have dampened the upside. The Zacks Consensus Estimate for the combined ratio is pegged at 87, indicating a contraction of 800 basis points from the year-ago reported figure.
The Zacks Consensus Estimate for fourth-quarter 2023 earnings of $1.94 per share indicates a decrease of 9.4% from the year-ago quarter’s reported figure.
What the Zacks Model Says
Our proven model predicts an earnings beat for Arch Capital this time around. This is because the stock has the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold).
Earnings ESP: Arch Capital has an Earnings ESP of +1.24%. This is because the Most Accurate Estimate of $1.96 is pegged higher than the Zacks Consensus Estimate of $1.94. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Some other insurance stocks with the right combination of elements to deliver an earnings beat this time around are:
Primerica Inc. (PRI - Free Report) has an Earnings ESP of +0.28% and a Zacks Rank #2 at present. The Zacks Consensus Estimate for fourth-quarter 2023 earnings is pegged at $4.26, indicating a year-over-year increase of 22.1%.
PRI’s earnings beat estimates in the last four reported quarters.
Manulife Financial Corporation (MFC - Free Report) has an Earnings ESP of +0.80% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for fourth-quarter 2023 earnings is pegged at 63 cents, indicating a year-over-year decline of 3.1%.
MFC’s earnings beat estimates in the last four reported quarters.
Trupanion Inc. (TRUP - Free Report) has an Earnings ESP of +25.82% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for fourth-quarter 2023 bottom line is pegged at a loss of 18 cents, indicating a year-over-year improvement of 21.7%.
TRUP’s earnings beat estimates in three of the last four quarters while missing in one.
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Is a Beat in Store for Arch Capital (ACGL) in Q4 Earnings?
Arch Capital Group Ltd. (ACGL - Free Report) is slated to report fourth-quarter 2023 earnings on Feb 14, after market close. The insurer delivered an earnings surprise in each of the last four quarters, the average beat being 26.83%.
Factors to Consider
Growth in new business as well as in existing accounts and rate increases in the Insurance and Reinsurance segments are likely to have favored net premiums earned.
The Zacks Consensus Estimate for net premiums earned is pegged at $3.4 billion, indicating an increase of 22.5% from the year-ago reported figure. We expect net premiums earned to increase 19.9% to $3.3 billion.
Net investment income is likely to have benefited from increased rates and a wider investment base. We expect net investment income to increase 106.2% to $265.3 million. The Zacks Consensus Estimate for investment income is pegged at $303.2 million, indicating a 55.2% increase from the year-ago reported figure.
The top line is likely to have benefited from improved earned premiums and higher net investment income. The Zacks Consensus Estimate for revenues is pegged at $3.7 billion, indicating an increase of 24.3% from the year-ago reported figure.
Expenses are expected to have increased on higher losses and loss adjustment expenses, acquisition costs and other operating expenses. We expect total expenses to increase 30.8% to $2.9 billion.
Underwriting profitability is likely to have benefited from rate increases and a balanced business mix. However, higher loss and loss adjustment expenses are likely to have dampened the upside. The Zacks Consensus Estimate for the combined ratio is pegged at 87, indicating a contraction of 800 basis points from the year-ago reported figure.
The Zacks Consensus Estimate for fourth-quarter 2023 earnings of $1.94 per share indicates a decrease of 9.4% from the year-ago quarter’s reported figure.
What the Zacks Model Says
Our proven model predicts an earnings beat for Arch Capital this time around. This is because the stock has the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold).
Earnings ESP: Arch Capital has an Earnings ESP of +1.24%. This is because the Most Accurate Estimate of $1.96 is pegged higher than the Zacks Consensus Estimate of $1.94. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Arch Capital Group Ltd. Price and EPS Surprise
Arch Capital Group Ltd. price-eps-surprise | Arch Capital Group Ltd. Quote
Zacks Rank: ACGL currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks to Consider
Some other insurance stocks with the right combination of elements to deliver an earnings beat this time around are:
Primerica Inc. (PRI - Free Report) has an Earnings ESP of +0.28% and a Zacks Rank #2 at present. The Zacks Consensus Estimate for fourth-quarter 2023 earnings is pegged at $4.26, indicating a year-over-year increase of 22.1%.
PRI’s earnings beat estimates in the last four reported quarters.
Manulife Financial Corporation (MFC - Free Report) has an Earnings ESP of +0.80% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for fourth-quarter 2023 earnings is pegged at 63 cents, indicating a year-over-year decline of 3.1%.
MFC’s earnings beat estimates in the last four reported quarters.
Trupanion Inc. (TRUP - Free Report) has an Earnings ESP of +25.82% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for fourth-quarter 2023 bottom line is pegged at a loss of 18 cents, indicating a year-over-year improvement of 21.7%.
TRUP’s earnings beat estimates in three of the last four quarters while missing in one.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.