Back to top

Analyst Blog

United Fire Group Inc. (UFCS - Snapshot Report) reported third-quarter 2013 operating net income of 42 cents per share, missing the Zacks Consensus Estimate of 54 cents significantly by 22.2%. However, the results exceeded the year-ago quarter earnings by 35.5%.

Including after-tax net realized investment gains of 3 cents per share, United Fire reported net income of 45 cents per share, up approximately 32.3% year over year.

United Fire’s bottom-line growth in the reported quarter came on the back of higher net written premiums owing to increasing rates in its commercial lines of business.

Quarterly Operational Update

Total revenues of United Fire increased 7.9% year over year to $223 million, driven mainly by an improvement in net premiums earned (up 10%). Total revenues also surpassed the Zacks Consensus Estimate of $218 million by 2.3%.

United Fire’s net investment income of $27.3 million declined 4.8% year over year.

Total benefits, losses and expenses in the quarter increased 6.1% year over year to $208.6 million. The increase was induced by higher loss and loss settlement expenses, amortization of deferred policy acquisition costs and other underwriting expenses.

Combined ratio improved 220 basis points from the year-ago quarter to 100.3% due to lower catastrophe losses.

Quarterly Segment Update

Property and Casualty: Net premium written for this segment soared 14.7% year over year to $178.3 million in the reported quarter.

Total revenues amounted to $191.2 million in the reported quarter increasing 10.2% year over year on the back of higher net earned premiums and net investment income.

Net income of $10.3 million, up 35.5% from net income of $7.6 million reported in the comparable prior-year period.  

Life Insurance: Net premiums written in the segment were $15.7 million, up 2.4% from the year-ago quarter.

Total revenues declined 3.9% year over year to $31.8 million in the reported quarter due to lower net investment income.

Net income of $1.4 million registered an increase of 27.3% year over year.

Dividend Update

In the third quarter, United Fire paid dividend of 18 cents per share to shareholders of record as of Sep 3, 2013.

Financial Position

As of Sep 30, 2013, United Fire had cash and cash investments of $3.12 billion, down 0.9% from $3.15 billion as of Dec 31, 2012.

United Fire exited the reported quarter with total assets of $3.72 billion, declining 0.8% from the 2012 year-end level.

Shareholders’ equity as of Sep 30, 2013 was $744.2 million, up 2.1% from $729.2 million as of Dec 31, 2012.

Performances of Other Property and Casualty Insurers

Allied World Assurance Company Holdings, AG (AWH - Snapshot Report) reported its third-quarter 2013 operating net income of $2.93 per share, surpassing the Zacks Consensus Estimate by 37.5% and the prior-year figure by 35.6%.

Aspen Insurance Holdings Ltd. (AHL - Snapshot Report) reported third-quarter 2013 operating net income of $1.05 per share, which substantially surpassed the Zacks Consensus Estimate of 80 cents by 31.2%. However, the results lagged the year-ago quarter number by 21.6%.

ACE Limited (ACE - Analyst Report) reported third-quarter 2013 operating net income of $2.49 per share, beating the Zacks Consensus Estimate by 12.7%. Results also improved 23.9% from the year-ago quarter.

Zacks Rank

United Fire presently carries a Zacks Rank #2 (Buy).
 

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
UNITED THER… UTHR 117.81 +28.49%
TRIQUINT SE… TQNT 20.70 +6.70%
VASCO DATA… VDSI 14.81 +4.96%
TESLA MOTOR… TSLA 276.46 +4.78%
CENTURY ALU… CENX 25.74 +4.61%