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.
Hallmark Financial Services Inc. (HALL - Free Report) posted operating earnings of 27 cents per share in the third quarter of 2016. The quarterly earnings missed the Zacks Consensus Estimate by 15.6% and also plunged 22.9% year over year.
The company witnessed catastrophe losses of $2.2 million or 8 cents per share in the quarter. In the Personal segment, Auto line of business continues to face headwinds, which have been weighing on its results. Nonetheless, the Specialty Commercial segment and Standard Commercial segment continued to deliver solid performances.
Behind the Headlines
Hallmark Financial generated operating revenues of $95 million, up 3.2% year over year. Higher net premiums earned drove the upside. Operating revenues surpassed the Zacks Consensus Estimate of $92 million.
Total expense of Hallmark Financial increased 7.9% year over year to $90.4 million due to higher losses and loss adjustment expenses and interest expenses.
Net loss ratio deteriorated 540 basis points (bps) year over year to 68.7%. Combined ratio of Hallmark Financial was 96.6%, deteriorated 560 bps.
Segment Update
Specialty Commercial: Total revenue increased 3.9% year over year to $65.8 million due to higher net premiums earned.
Pre-tax income plunged 27.4% to $8.2 million in the quarter.
Combined ratio deteriorated 570 bps to 91.8%.
Standard Commercial: Total revenue was down 1% year over year to $18.3 million due to decrease in net premiums earned.
Pre-tax income increased 10.3% year over year to $3.2 million in the quarter.
Combined ratio improved 180 bps over year at 89.2%.
Personal Segment: Total revenue inched up 0.8% year over year to $12.8 million in the quarter due to higher net premiums earned.
Pre-tax loss of $1.8 million was wider than a loss of $0.2 million incurred in the year-ago quarter. Increase in losses and loss adjustment expenses resulted in the wider loss.
Combined ratio deteriorated 1410 bps to 119.4%.
Corporate: Total revenue was $0.8 million compared with ($0.9) million in the year-ago quarter.
Pre-tax loss of $2.5 million was narrower than a loss of $4.1 million in the year-ago quarter.
Financial Details
Hallmark Financial exited the quarter with total investments of $649.6 million, up 12.2% from year-end 2015.
Cash and cash equivalents declined 34% to $69.9 million in the quarter.
Cash flow from operations soared 127% year over year to $23.5 million in the reported quarter.
As of Sep 30, 2016, Hallmark Financial’s book value per share was $14.53, up 7% year over year. Stockholder’s equity was $270 million, up 3.4% from year-end 2015.
The bottom line at The Travelers Companies, Inc. (TRV - Free Report) and AXIS Capital Holdings Limited (AXS - Free Report) beat the Zacks Consensus Estimate, while earnings of RLI Corp. (RLI - Free Report) missed the same in the third quarter.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to 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. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades>>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Hallmark Financial (HALL) Q3 Earnings Miss, Revenues Beat
Hallmark Financial Services Inc. (HALL - Free Report) posted operating earnings of 27 cents per share in the third quarter of 2016. The quarterly earnings missed the Zacks Consensus Estimate by 15.6% and also plunged 22.9% year over year.
The company witnessed catastrophe losses of $2.2 million or 8 cents per share in the quarter. In the Personal segment, Auto line of business continues to face headwinds, which have been weighing on its results. Nonetheless, the Specialty Commercial segment and Standard Commercial segment continued to deliver solid performances.
Behind the Headlines
Hallmark Financial generated operating revenues of $95 million, up 3.2% year over year. Higher net premiums earned drove the upside. Operating revenues surpassed the Zacks Consensus Estimate of $92 million.
Total expense of Hallmark Financial increased 7.9% year over year to $90.4 million due to higher losses and loss adjustment expenses and interest expenses.
Net loss ratio deteriorated 540 basis points (bps) year over year to 68.7%. Combined ratio of Hallmark Financial was 96.6%, deteriorated 560 bps.
Segment Update
Specialty Commercial: Total revenue increased 3.9% year over year to $65.8 million due to higher net premiums earned.
Pre-tax income plunged 27.4% to $8.2 million in the quarter.
Combined ratio deteriorated 570 bps to 91.8%.
Standard Commercial: Total revenue was down 1% year over year to $18.3 million due to decrease in net premiums earned.
Pre-tax income increased 10.3% year over year to $3.2 million in the quarter.
Combined ratio improved 180 bps over year at 89.2%.
Personal Segment: Total revenue inched up 0.8% year over year to $12.8 million in the quarter due to higher net premiums earned.
Pre-tax loss of $1.8 million was wider than a loss of $0.2 million incurred in the year-ago quarter. Increase in losses and loss adjustment expenses resulted in the wider loss.
Combined ratio deteriorated 1410 bps to 119.4%.
Corporate: Total revenue was $0.8 million compared with ($0.9) million in the year-ago quarter.
Pre-tax loss of $2.5 million was narrower than a loss of $4.1 million in the year-ago quarter.
Financial Details
Hallmark Financial exited the quarter with total investments of $649.6 million, up 12.2% from year-end 2015.
Cash and cash equivalents declined 34% to $69.9 million in the quarter.
Cash flow from operations soared 127% year over year to $23.5 million in the reported quarter.
As of Sep 30, 2016, Hallmark Financial’s book value per share was $14.53, up 7% year over year. Stockholder’s equity was $270 million, up 3.4% from year-end 2015.
Zacks Rank
Hallmark Financial carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here
HALLMARK FINL Price, Consensus and EPS Surprise
HALLMARK FINL Price, Consensus and EPS Surprise | HALLMARK FINL Quote
Performance of Other P&C Insurers
The bottom line at The Travelers Companies, Inc. (TRV - Free Report) and AXIS Capital Holdings Limited (AXS - Free Report) beat the Zacks Consensus Estimate, while earnings of RLI Corp. (RLI - Free Report) missed the same in the third quarter.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to 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. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades>>