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Everest Re Group (RE) Beats on Q1 Earnings and Revenues
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Everest Re Group Ltd. reported first-quarter 2017 operating earnings of $6.29 per share that outpaced the Zacks Consensus Estimate of $5.36 by 17.4%. The bottom line also improved 21.2% from the prior-year quarter.
The company witnessed an increase in premiums and investment income, which fueled top-line improvement. Everest Re Group noted strong momentum across its underwriting operations, with opportunities in both reinsurance and insurance.
Including net realized capital gain of 78 cents per share, the company’s net income surged 77% year over year to $7.07 per share. Operational Update
Everest Re Group’s total operating revenue of $1.43 billion increased nearly 7% year over year. However, revenues beat the Zacks Consensus Estimate of $1.41 billion.
Gross written premiums grew 18% year over year to $1.6 billion. The company’s worldwide reinsurance premiums increased 19% to $1.2 billion, primarily due to the new crop reinsurance transaction and growth in financial lines premium. Direct insurance premiums also improved 15% to $434 million sequentially.
Net investment income came in at $122.3 million in the quarter, up 19% year over year.
Total claims and expenses increased 7.7% year over year to $1.1 billion. Higher incurred losses and loss adjustment expenses, commission, brokerage, taxes and fees, and corporate expenses were responsible for the increase.
Combined ratio remained flat year over year at 86%. Excluding catastrophe losses from the Australian windstorm, Cyclone Debbie, and prior-year development, combined ratio improved 80% year over year to 84.5%.
Everest Re Group, Ltd. Price, Consensus and EPS Surprise
Everest Re Group exited the quarter with total assets of $22.2 billion, up 4.2% from $21.3 billion at the end of 2016. Everest Re Group’s shareholder equity at the end of the reported quarter rose 2.5% to $8.3 billion from the 2015-end level of $7.6 billion.
Total cash balance at the end of the quarter declined 2.8% to $468.2 million from $283.7 million at the end of 2016. Everest Re Group's cash flow from operations was $381.8 million, up 1.7% year on year.
Book value per share increased 3% to $203.32 as of Mar 31, 2017 from $197.45 as of Dec 31, 2016.
Return on equity was 12.8% in the quarter.
Dividend Update
The company raised its dividend by a dime from the year-ago quarter to $1.25 per share.
Among the other players from the insurance industry that have reported their first-quarter earnings so far, the bottom line at Brown & Brown Inc. (BRO - Free Report) beat the Zacks Consensus Estimate but RLI Corp. (RLI - Free Report) and The Progressive Corporation (PGR - Free Report) missed expectations.
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Everest Re Group (RE) Beats on Q1 Earnings and Revenues
Everest Re Group Ltd. reported first-quarter 2017 operating earnings of $6.29 per share that outpaced the Zacks Consensus Estimate of $5.36 by 17.4%. The bottom line also improved 21.2% from the prior-year quarter.
The company witnessed an increase in premiums and investment income, which fueled top-line improvement. Everest Re Group noted strong momentum across its underwriting operations, with opportunities in both reinsurance and insurance.
Including net realized capital gain of 78 cents per share, the company’s net income surged 77% year over year to $7.07 per share.
Operational Update
Everest Re Group’s total operating revenue of $1.43 billion increased nearly 7% year over year. However, revenues beat the Zacks Consensus Estimate of $1.41 billion.
Gross written premiums grew 18% year over year to $1.6 billion. The company’s worldwide reinsurance premiums increased 19% to $1.2 billion, primarily due to the new crop reinsurance transaction and growth in financial lines premium. Direct insurance premiums also improved 15% to $434 million sequentially.
Net investment income came in at $122.3 million in the quarter, up 19% year over year.
Total claims and expenses increased 7.7% year over year to $1.1 billion. Higher incurred losses and loss adjustment expenses, commission, brokerage, taxes and fees, and corporate expenses were responsible for the increase.
Combined ratio remained flat year over year at 86%. Excluding catastrophe losses from the Australian windstorm, Cyclone Debbie, and prior-year development, combined ratio improved 80% year over year to 84.5%.
Everest Re Group, Ltd. Price, Consensus and EPS Surprise
Everest Re Group, Ltd. Price, Consensus and EPS Surprise | Everest Re Group, Ltd. Quote
Financial Update
Everest Re Group exited the quarter with total assets of $22.2 billion, up 4.2% from $21.3 billion at the end of 2016. Everest Re Group’s shareholder equity at the end of the reported quarter rose 2.5% to $8.3 billion from the 2015-end level of $7.6 billion.
Total cash balance at the end of the quarter declined 2.8% to $468.2 million from $283.7 million at the end of 2016. Everest Re Group's cash flow from operations was $381.8 million, up 1.7% year on year.
Book value per share increased 3% to $203.32 as of Mar 31, 2017 from $197.45 as of Dec 31, 2016.
Return on equity was 12.8% in the quarter.
Dividend Update
The company raised its dividend by a dime from the year-ago quarter to $1.25 per share.
Zacks Rank
Currently, Everest Re holds a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here..
Performance of Other Insurers
Among the other players from the insurance industry that have reported their first-quarter earnings so far, the bottom line at Brown & Brown Inc. (BRO - Free Report) beat the Zacks Consensus Estimate but RLI Corp. (RLI - Free Report) and The Progressive Corporation (PGR - Free Report) missed expectations.
Zacks’ Best Private Investment Ideas
While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public.
Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors.
Click here for Zacks' private trades >>