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Loews (L) Q4 Earnings Beat Estimates, Revenues Decline Y/Y

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Loews Corporation (L - Free Report) reported fourth-quarter 2016 operating earnings of 79 cents per share, which beat the Zacks Consensus Estimate of 63 cents. The insurer had incurred loss of 58 cents per share in the year-ago quarter.

 

The quarter witnessed better performance by CNA Financial (CNA - Free Report) and Boardwalk Pipeline Partners’ and improved results from the parent company’s investment portfolio. However, lower earnings at Diamond Offshore (DO - Free Report) and Boardwalk Pipeline were partial dampeners.

Revenues

Operating revenues of $3.3 billion declined 1.7% year over year. Lower insurance revenues and contract drilling revenues led to the downside.

2016 Highlight

Net income surged 160% year over year to $1.87 per share. Revenues of $13.1 billion dipped 2.3% from 2015.

Behind the Headlines

Total expenses decreased 23.7% year over year to $2.9 billion, largely due to lower contract drilling expenses and other operating expenses.

CNA Financial’s revenues increased 5.8% from the prior-year quarter to $2.4 billion. It reported net income attributable to Loews Corp. of $217 million, which compared favorably with a loss of $62 million in the year-ago quarter. The improvement was attributable to higher net investment income, which in turn, was driven by limited partnership investments as well as realized investment gains.

Boardwalk Pipeline’s revenues increased 7.9% year over year to $355 million. Its net income attributable to Loews Corp. increased 42% year over year to $27 million. The improvement was supported by revenues from new growth projects recently placed in service.

Loews Hotels’ revenues grew about 1.3% year over year to $154 million. Income attributable to Loews was $5 million, which compared favorably with a loss of $3 million in the year-ago quarter.

Diamond Offshore’s revenues declined 30.4% year over year to $390 million. Net income attributable to Loews was $36 million, which compared favorably with a loss of $122 million in the year-ago quarter.

As of Dec 31, 2016, book value was $53.89 per share, up about 4.3% from $51.67 as of Dec 31, 2015.

Share Repurchase

During the fourth quarter of 2016, Loews spent $19 million to buy back 0.4 million shares. This take 2016 tally to $134 million spent to buy back 3.4 million shares.

Loews Corporation Price, Consensus and EPS Surprise

 

Loews Corporation Price, Consensus and EPS Surprise | Loews Corporation Quote

Zacks Rank

Loews currently holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.

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