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P&C Insurers' Earnings Reporting on May 8: AFSI, NGHC, MHLD
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The Q1 earnings season is in full swing with 78.2% members of the elite S&P 500 Index reporting solid quarterly numbers so far. According to the latest Earnings Outlook, the performance of 358 index members that have already reported their financial numbers this quarter indicate that total earnings have increased 12.9% on 7.9% higher revenues. The beat ratio is impressive with 74.3% companies surpassing bottom-line expectations and 65.9% outperforming on the top-line front.
The Finance sector (one of the 16 Zacks sectors) has delivered a strong performance so far. Financial performance of 86.2% companies from this sector that have revealed their quarterly results shows 9.6% earnings growth on 6.3% increase in revenues, both on a year-over-year basis. The beat ratio of 70.4% for the bottom line is below the S&P 500 but the beat ratio of 66.7% for the top line is higher than that of the S&P 500.
Insurers (particularly the property and casualty companies) are likely to witness improvement in underwriting results owing to a benign catastrophe environment. However, impact of storms in Midwest and the South that occurred during Feb 28 and Mar 22, as well as cyclone Debbie in Australia weighed on underwriting results.
Nonetheless, the improving interest rate, albeit at a slower pace, should cushion investment results that suffered due to the prolonged period of low rates. Owing to a stabilizing economy, improving employment and inflation reaching 2%, the Fed raised interest rates in Dec 2016 and in Mar 2017. Investment income, which is a major component of insurers’ top line, is improving. Also, a stronger economy means more disposable income and better consumer sentiment. This, in turn, is likely to have supported more policy writings, driving premiums higher.
Prudent underwriting practices should also have supported investors. However, we do not expect pricings to be strong. Nonetheless, core business growth, geographic expansion, strategic acquisitions and effective capital deployment via share repurchase should prove beneficial for insurers.
Per our earnings outlook, results from the remaining 142 index members should also be impressive. Earnings are estimated to grow 11.9% on 6.2% higher revenues with Finance, Technology, Industrial Products, Basic Materials, and Business Services on track to achieve double-digit earnings growth.
Let’s find out how these three property and casualty insurers might perform when they release their quarterly numbers on May 8.
AmTrust Financial Services, Inc. underwrites and provides property and casualty insurance in the United States and internationally. In the last reported quarter, AmTrust Financial missed the Zacks Consensus Estimate by 47.95%. Our proven model does not conclusively show that AmTrust Financial is likely to beat the Zacks Consensus Estimate this quarter. This is because the company has Zacks Rank #5 (Strong Sell) and Earnings ESP of 0.00%. Both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 64 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Please note that the Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement, especially when the company is seeing negative estimate revisions.
With respect to surprise trend, AmTrust Financial surpassed expectations in three of the last four quarters but with an average negative surprise of 6.03%.
AmTrust Financial Services, Inc. Price and EPS Surprise
National General Holdings Corp. provides personal and commercial automobile, supplemental health, homeowners and umbrella, and other niche insurance products in the United States. National General beat the Zacks Consensus Estimate by 25.0% in the last reported quarter. Our proven model does not conclusively show that National General is likely to beat the Zacks Consensus Estimate this quarter. This is because the company has a Zacks Rank #4 and an Earnings ESP of 0.00%. The Most Accurate Estimate and the Zacks Consensus Estimate stand at 38 cents.
With respect to the surprise trend, National General surpassed expectations in three of the last four quarters but with an average beat of 9.67%.
National General Holdings Corp Price and EPS Surprise
Maiden Holdings, Ltd (MHLD - Free Report) provides reinsurance solutions to regional and specialty insurers in the United States, Europe, and internationally. In the last reported quarter, Maiden Holdings beat the Zacks Consensus Estimate by 18.18%. Our proven model does not conclusively show that Maiden Holdings is likely to beat estimates this time. This is because the company has a Zacks Rank #5 and an Earnings ESP of 0.00%. The Most Accurate Estimate and the Zacks Consensus Estimate stand at 38 cents.
With respect to the surprise trend, Maiden Holdings surpassed expectations in three of the last four quarters but with an average negative surprise of 7.33%.
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With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research. It's not the one you think.
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P&C Insurers' Earnings Reporting on May 8: AFSI, NGHC, MHLD
The Q1 earnings season is in full swing with 78.2% members of the elite S&P 500 Index reporting solid quarterly numbers so far. According to the latest Earnings Outlook, the performance of 358 index members that have already reported their financial numbers this quarter indicate that total earnings have increased 12.9% on 7.9% higher revenues. The beat ratio is impressive with 74.3% companies surpassing bottom-line expectations and 65.9% outperforming on the top-line front.
The Finance sector (one of the 16 Zacks sectors) has delivered a strong performance so far. Financial performance of 86.2% companies from this sector that have revealed their quarterly results shows 9.6% earnings growth on 6.3% increase in revenues, both on a year-over-year basis. The beat ratio of 70.4% for the bottom line is below the S&P 500 but the beat ratio of 66.7% for the top line is higher than that of the S&P 500.
Insurers (particularly the property and casualty companies) are likely to witness improvement in underwriting results owing to a benign catastrophe environment. However, impact of storms in Midwest and the South that occurred during Feb 28 and Mar 22, as well as cyclone Debbie in Australia weighed on underwriting results.
Nonetheless, the improving interest rate, albeit at a slower pace, should cushion investment results that suffered due to the prolonged period of low rates. Owing to a stabilizing economy, improving employment and inflation reaching 2%, the Fed raised interest rates in Dec 2016 and in Mar 2017. Investment income, which is a major component of insurers’ top line, is improving. Also, a stronger economy means more disposable income and better consumer sentiment. This, in turn, is likely to have supported more policy writings, driving premiums higher.
Prudent underwriting practices should also have supported investors. However, we do not expect pricings to be strong. Nonetheless, core business growth, geographic expansion, strategic acquisitions and effective capital deployment via share repurchase should prove beneficial for insurers.
Per our earnings outlook, results from the remaining 142 index members should also be impressive. Earnings are estimated to grow 11.9% on 6.2% higher revenues with Finance, Technology, Industrial Products, Basic Materials, and Business Services on track to achieve double-digit earnings growth.
Let’s find out how these three property and casualty insurers might perform when they release their quarterly numbers on May 8.
AmTrust Financial Services, Inc. underwrites and provides property and casualty insurance in the United States and internationally. In the last reported quarter, AmTrust Financial missed the Zacks Consensus Estimate by 47.95%. Our proven model does not conclusively show that AmTrust Financial is likely to beat the Zacks Consensus Estimate this quarter. This is because the company has Zacks Rank #5 (Strong Sell) and Earnings ESP of 0.00%. Both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 64 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Please note that the Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement, especially when the company is seeing negative estimate revisions.
With respect to surprise trend, AmTrust Financial surpassed expectations in three of the last four quarters but with an average negative surprise of 6.03%.
AmTrust Financial Services, Inc. Price and EPS Surprise
AmTrust Financial Services, Inc. Price and EPS Surprise | AmTrust Financial Services, Inc. Quote
National General Holdings Corp. provides personal and commercial automobile, supplemental health, homeowners and umbrella, and other niche insurance products in the United States. National General beat the Zacks Consensus Estimate by 25.0% in the last reported quarter. Our proven model does not conclusively show that National General is likely to beat the Zacks Consensus Estimate this quarter. This is because the company has a Zacks Rank #4 and an Earnings ESP of 0.00%. The Most Accurate Estimate and the Zacks Consensus Estimate stand at 38 cents.
With respect to the surprise trend, National General surpassed expectations in three of the last four quarters but with an average beat of 9.67%.
National General Holdings Corp Price and EPS Surprise
National General Holdings Corp Price and EPS Surprise | National General Holdings Corp Quote
Maiden Holdings, Ltd (MHLD - Free Report) provides reinsurance solutions to regional and specialty insurers in the United States, Europe, and internationally. In the last reported quarter, Maiden Holdings beat the Zacks Consensus Estimate by 18.18%. Our proven model does not conclusively show that Maiden Holdings is likely to beat estimates this time. This is because the company has a Zacks Rank #5 and an Earnings ESP of 0.00%. The Most Accurate Estimate and the Zacks Consensus Estimate stand at 38 cents.
With respect to the surprise trend, Maiden Holdings surpassed expectations in three of the last four quarters but with an average negative surprise of 7.33%.
Maiden Holdings, Ltd. Price and EPS Surprise
Maiden Holdings, Ltd. Price and EPS Surprise | Maiden Holdings, Ltd. Quote
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research. It's not the one you think.
See This Ticker Free >>