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Why Is AMERISAFE (AMSF) Down 0.2% Since Last Earnings Report?
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A month has gone by since the last earnings report for Amerisafe (AMSF - Free Report) . Shares have lost about 0.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is AMERISAFE due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
AMERISAFE Beats Q4 Earnings, Hikes Dividend by 8.8%
AMERISAFE reported fourth-quarter 2023 adjusted earnings per share (EPS) of 74 cents, which outpaced the Zacks Consensus Estimate by 12.1%. However, the bottom line fell 11.9% year over year.
Operating revenues of $74 million remained flat year over year. The top line fell short of the consensus mark by 1.7%.
The quarterly results benefited on the back of higher gross premiums written, an increase in voluntary premiums due to expanding policy count coupled with favorable payroll audits and related premium adjustments. Sound investment results also contributed to the upside, which was, however, partly offset by softer underwriting results and an elevated expense level.
Q4 Performance
AMSF’s net premiums earned dipped 0.5% year over year to $65.7 million in the quarter under review and missed the consensus mark of $67 million.
Net investment income amounted to $8.08 million, which improved 5.7% year over year on the back of an increase in fixed-income reinvestment rates. The figure missed the Zacks Consensus Estimate of $8.12 million. Fee and other income dropped 19% year over year.
AMERISAFE’s pre-tax underwriting profit fell 20.2% year over year to $9.5 million.
Total expenses of $56.2 million increased 3.8% year over year in the fourth quarter due to higher underwriting and other operating costs and policyholder dividends.
Operating net income was $14.3 million, which tumbled 11.4% year over year.
The net combined ratio deteriorated 350 basis points (bps) year over year to 85.5% but came lower than the consensus mark of 89%. The metric was hurt by a deteriorating net underwriting expense ratio and net loss ratio.
Financial Update (as of Dec 31, 2023)
AMERISAFE exited the fourth quarter with cash and cash equivalents of $38.7 million, which plunged 37.1% from the 2022-end level.
Total assets of $1.2 billion fell 3.2% from the figure at 2022 end.
Shareholders' equity declined 7.9% from the 2022-end level to $292.5 million.
Book value per share was $15.28 as of Dec 31, 2023, which slipped 7.8% year over year.
Return on average equity of 24.4% improved 30 bps year over year in the quarter under review.
Capital Deployment Update
AMERISAFE bought back shares worth $2.2 million in the fourth quarter. A leftover capacity of $10.4 million remained under its share repurchase authorization as of Dec 31, 2023.
Management sanctioned an 8.8% hike in the regular quarterly dividend. The increased dividend was 37 cents per share, which will be paid out on Mar 22, 2024, to its shareholders of record as of Mar 8, 2024.
Full-Year Update
AMERISAFE’s adjusted EPS fell 5.2% year over year to $2.91 in 2023. Total revenues of $306.9 million improved 4.1% year over year.
Net premiums earned of $267.1 million decreased 1.7% year over year. Net investment income advanced 15.1% year over year to $31.3 million.
AMSF reported a pre-tax underwriting profit of $37.6 million in 2023, which declined 15.8% year over year. The net combined ratio deteriorated 230 bps year over year to 85.9%.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
The consensus estimate has shifted 7.32% due to these changes.
VGM Scores
At this time, AMERISAFE has a poor Growth Score of F, however its Momentum Score is doing a lot better with an A. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise AMERISAFE has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Why Is AMERISAFE (AMSF) Down 0.2% Since Last Earnings Report?
A month has gone by since the last earnings report for Amerisafe (AMSF - Free Report) . Shares have lost about 0.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is AMERISAFE due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
AMERISAFE Beats Q4 Earnings, Hikes Dividend by 8.8%
AMERISAFE reported fourth-quarter 2023 adjusted earnings per share (EPS) of 74 cents, which outpaced the Zacks Consensus Estimate by 12.1%. However, the bottom line fell 11.9% year over year.
Operating revenues of $74 million remained flat year over year. The top line fell short of the consensus mark by 1.7%.
The quarterly results benefited on the back of higher gross premiums written, an increase in voluntary premiums due to expanding policy count coupled with favorable payroll audits and related premium adjustments. Sound investment results also contributed to the upside, which was, however, partly offset by softer underwriting results and an elevated expense level.
Q4 Performance
AMSF’s net premiums earned dipped 0.5% year over year to $65.7 million in the quarter under review and missed the consensus mark of $67 million.
Net investment income amounted to $8.08 million, which improved 5.7% year over year on the back of an increase in fixed-income reinvestment rates. The figure missed the Zacks Consensus Estimate of $8.12 million. Fee and other income dropped 19% year over year.
AMERISAFE’s pre-tax underwriting profit fell 20.2% year over year to $9.5 million.
Total expenses of $56.2 million increased 3.8% year over year in the fourth quarter due to higher underwriting and other operating costs and policyholder dividends.
Operating net income was $14.3 million, which tumbled 11.4% year over year.
The net combined ratio deteriorated 350 basis points (bps) year over year to 85.5% but came lower than the consensus mark of 89%. The metric was hurt by a deteriorating net underwriting expense ratio and net loss ratio.
Financial Update (as of Dec 31, 2023)
AMERISAFE exited the fourth quarter with cash and cash equivalents of $38.7 million, which plunged 37.1% from the 2022-end level.
Total assets of $1.2 billion fell 3.2% from the figure at 2022 end.
Shareholders' equity declined 7.9% from the 2022-end level to $292.5 million.
Book value per share was $15.28 as of Dec 31, 2023, which slipped 7.8% year over year.
Return on average equity of 24.4% improved 30 bps year over year in the quarter under review.
Capital Deployment Update
AMERISAFE bought back shares worth $2.2 million in the fourth quarter. A leftover capacity of $10.4 million remained under its share repurchase authorization as of Dec 31, 2023.
Management sanctioned an 8.8% hike in the regular quarterly dividend. The increased dividend was 37 cents per share, which will be paid out on Mar 22, 2024, to its shareholders of record as of Mar 8, 2024.
Full-Year Update
AMERISAFE’s adjusted EPS fell 5.2% year over year to $2.91 in 2023. Total revenues of $306.9 million improved 4.1% year over year.
Net premiums earned of $267.1 million decreased 1.7% year over year. Net investment income advanced 15.1% year over year to $31.3 million.
AMSF reported a pre-tax underwriting profit of $37.6 million in 2023, which declined 15.8% year over year. The net combined ratio deteriorated 230 bps year over year to 85.9%.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
The consensus estimate has shifted 7.32% due to these changes.
VGM Scores
At this time, AMERISAFE has a poor Growth Score of F, however its Momentum Score is doing a lot better with an A. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise AMERISAFE has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.