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RenaissanceRe (RNR) Up 2.7% Since Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for RenaissanceRe Holdings Ltd. (RNR - Free Report) . Shares have added about 2.7% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
RenaissanceRe Q1 Earnings Miss Estimates, Fall Y/Y
RenaissanceRe Holdings first-quarter 2017 operating earnings per share of $1.18 missed the Zacks Consensus Estimate by 40%. The bottom line also plunged 21.8% year over year. The downside stemmed from an increase in the company’s combined ratio due to the change in Ogden rate.
RenaissanceRe’s first-quarter operating revenues of $422 million increased 9.3% year over year due to higher premiums and net investment income.
Quarterly Operational Update:
Gross premiums written grew 7% year over year to $922.1 million.
Net investment income of $54.3 million grew 86% from the prior-year quarter. The recent hike in interest rates is expected to have supported this improvement.
RenaissanceRe witnessed a year-over-year increase of 27% in total expenses to $339.4 million. This was mainly due to higher net claims and claim expenses as well as acquisition-related costs.
Quarterly Segment Update
Property Segment: Gross premiums written were $520.5 million, up 17% year over year. Underwriting income decreased 13.3% year over year to $91.4 million. Combined ratio of 51.1% deteriorated 1080 basis points (bps) year over year.
Casualty and Specialty Segment: Gross premiums written were $401.6 million, down 3.7% from the prior-year quarter. The company incurred underwriting loss of $3 million as against an underwriting income of $0.5 million in the prior-year quarter. Combined ratio of 127.5% deteriorated 2780 bps year over year
Financial Position
As of Mar 31, 2017, total asset of RenaissanceRe was $13.3 billion, up 0.8% year over year.
The company had total debt of $945.7 million as of Mar 31, 2017, down almost 0.3% from year-end 2016.
Cash and cash equivalents were $454 million, up 7.8% from Mar 31, 2017.
Share Repurchase
RenaissanceRe repurchased 0.55 million common shares in open market transactions at an aggregate cost of $80.0 million and an average price of $145.36 per common share
How Have Estimates Been Moving Since Then?
It turns out, fresh estimate flatlined during the past month. There has been one revision higher for the current quarter compared to one lower.
At this time, RenaissanceRe's stock has a poor Growth Score of 'F', while it is doing a bit better on the momentum front with 'D'. Following a similar same course, the stock was allocated a grade of 'F' on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate investors will probably be better served looking elsewhere.
Outlook
The stock has a Zacks Rank #5 (Strong Sell). We are expecting a below average return from the stock in the next few months.
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RenaissanceRe (RNR) Up 2.7% Since Earnings Report: Can It Continue?
It has been about a month since the last earnings report for RenaissanceRe Holdings Ltd. (RNR - Free Report) . Shares have added about 2.7% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
RenaissanceRe Q1 Earnings Miss Estimates, Fall Y/Y
RenaissanceRe Holdings first-quarter 2017 operating earnings per share of $1.18 missed the Zacks Consensus Estimate by 40%. The bottom line also plunged 21.8% year over year. The downside stemmed from an increase in the company’s combined ratio due to the change in Ogden rate.
RenaissanceRe’s first-quarter operating revenues of $422 million increased 9.3% year over year due to higher premiums and net investment income.
Quarterly Operational Update:
Gross premiums written grew 7% year over year to $922.1 million.
Net investment income of $54.3 million grew 86% from the prior-year quarter. The recent hike in interest rates is expected to have supported this improvement.
RenaissanceRe witnessed a year-over-year increase of 27% in total expenses to $339.4 million. This was mainly due to higher net claims and claim expenses as well as acquisition-related costs.
Quarterly Segment Update
Property Segment: Gross premiums written were $520.5 million, up 17% year over year. Underwriting income decreased 13.3% year over year to $91.4 million. Combined ratio of 51.1% deteriorated 1080 basis points (bps) year over year.
Casualty and Specialty Segment: Gross premiums written were $401.6 million, down 3.7% from the prior-year quarter. The company incurred underwriting loss of $3 million as against an underwriting income of $0.5 million in the prior-year quarter. Combined ratio of 127.5% deteriorated 2780 bps year over year
Financial Position
As of Mar 31, 2017, total asset of RenaissanceRe was $13.3 billion, up 0.8% year over year.
The company had total debt of $945.7 million as of Mar 31, 2017, down almost 0.3% from year-end 2016.
Cash and cash equivalents were $454 million, up 7.8% from Mar 31, 2017.
Share Repurchase
RenaissanceRe repurchased 0.55 million common shares in open market transactions at an aggregate cost of $80.0 million and an average price of $145.36 per common share
How Have Estimates Been Moving Since Then?
It turns out, fresh estimate flatlined during the past month. There has been one revision higher for the current quarter compared to one lower.
RenaissanceRe Holdings Ltd. Price and Consensus
RenaissanceRe Holdings Ltd. Price and Consensus | RenaissanceRe Holdings Ltd. Quote
VGM Scores
At this time, RenaissanceRe's stock has a poor Growth Score of 'F', while it is doing a bit better on the momentum front with 'D'. Following a similar same course, the stock was allocated a grade of 'F' on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate investors will probably be better served looking elsewhere.
Outlook
The stock has a Zacks Rank #5 (Strong Sell). We are expecting a below average return from the stock in the next few months.