We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
W.R. Berkley Corp. (WRB - Free Report) reported second-quarter 2016 operating income of 82 cents per share that beat the Zacks Consensus Estimate by 3.8%. Earnings also inched up 1.2% year over year. Increase in revenues offset the rise in expenses and lead to the outperformance. Also, the quarter witnessed improved investment results.
W.R. Berkley’s net written premium for the quarter was $1.64 billion, up 6.4% year over year. Higher premiums in Insurance and Reinsurance segments led to the improvement.
Total revenue came in at $1.86 billion, up 3.9% year over year. Investment income grew 2% year over year.
Total expenses increased 6%, primarily due to higher losses and loss expenses, expenses from non-insurance businesses as well as other operating costs and expenses.
Consolidated combined ratio (a measure of underwriting profitability) deteriorated 70 basis points (bps) year over year to 94.9%.
Segment Details
Net premiums written in the Insurance segment increased 5.1% year over year to $1.5 billion in the second quarter. The increase was mainly driven by higher premiums written under other liability and professional liability. Combined ratio in this segment improved by 10 bps year over year from 94.3% to 94.2%.
Net premiums written in the Reinsurance segment climbed 19.6% year over year to $170.8 million due to higher premiums written under both property and casualty reinsurance. Combined ratio deteriorated by 780 bps to 101.4%.
W.R. Berkley exited the second quarter with total assets worth $23 billion, up 6% from year-end 2015.
Book value per share increased 7.1% from year-end 2015 to $39.97 as of Jun 30, 2016.
Cash flow from operations plunged 42.6% year over year to $156 million.
The company’s return on equity decreased 120 bps to 9.5%.
Outlook
W.R. Berkley estimates pre-tax gain of $130 million from the sale of an investment in alternative portfolio in the third quarter.
Zacks Rank and Performance of Other Insurers
W.R. Berkley carries a Zacks Rank #3 (Hold).
Among the other players in the insurance industry that have reported their earnings so far, the bottom line at The Travelers Companies, Inc. (TRV - Free Report) and First American Financial Corporation (FAF - Free Report) beat their respective Zacks Consensus Estimate, while earnings of RLI Corp. (RLI - Free Report) missed the same.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
W.R. Berkley Corp (WRB) Q2 Earnings Beat, Increase Y/Y
W.R. Berkley Corp. (WRB - Free Report) reported second-quarter 2016 operating income of 82 cents per share that beat the Zacks Consensus Estimate by 3.8%. Earnings also inched up 1.2% year over year.
Increase in revenues offset the rise in expenses and lead to the outperformance. Also, the quarter witnessed improved investment results.
Operational Update
W.R. Berkley’s net written premium for the quarter was $1.64 billion, up 6.4% year over year. Higher premiums in Insurance and Reinsurance segments led to the improvement.
Total revenue came in at $1.86 billion, up 3.9% year over year. Investment income grew 2% year over year.
Total expenses increased 6%, primarily due to higher losses and loss expenses, expenses from non-insurance businesses as well as other operating costs and expenses.
Consolidated combined ratio (a measure of underwriting profitability) deteriorated 70 basis points (bps) year over year to 94.9%.
Segment Details
Net premiums written in the Insurance segment increased 5.1% year over year to $1.5 billion in the second quarter. The increase was mainly driven by higher premiums written under other liability and professional liability. Combined ratio in this segment improved by 10 bps year over year from 94.3% to 94.2%.
Net premiums written in the Reinsurance segment climbed 19.6% year over year to $170.8 million due to higher premiums written under both property and casualty reinsurance. Combined ratio deteriorated by 780 bps to 101.4%.
BERKLEY (WR) CP Price, Consensus and EPS Surprise
BERKLEY (WR) CP Price, Consensus and EPS Surprise | BERKLEY (WR) CP Quote
Financial Update
W.R. Berkley exited the second quarter with total assets worth $23 billion, up 6% from year-end 2015.
Book value per share increased 7.1% from year-end 2015 to $39.97 as of Jun 30, 2016.
Cash flow from operations plunged 42.6% year over year to $156 million.
The company’s return on equity decreased 120 bps to 9.5%.
Outlook
W.R. Berkley estimates pre-tax gain of $130 million from the sale of an investment in alternative portfolio in the third quarter.
Zacks Rank and Performance of Other Insurers
W.R. Berkley carries a Zacks Rank #3 (Hold).
Among the other players in the insurance industry that have reported their earnings so far, the bottom line at The Travelers Companies, Inc. (TRV - Free Report) and First American Financial Corporation (FAF - Free Report) beat their respective Zacks Consensus Estimate, while earnings of RLI Corp. (RLI - Free Report) missed the same.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>