Chubb Limited (CB - Free Report) reported second-quarter 2021 core operating income of $3.62 per share, which surpassed the Zacks Consensus Estimate by 22.3% on the back of improved premium revenues. The bottom line rebounded from the year-ago loss of 52 cents per share.
The company’s results benefited from highest organic P&C growth in over 15 years, driven by commercial P&C businesses and supported by continued robust commercial P&C pricing. The quarter marked record core operating earnings and underwriting results.
Chubb Limited Price, Consensus and EPS Surprise
Quarter in Detail
Net premiums written climbed 14.3% year over year to $9.5 billion in the quarter. Net premiums earned improved 8.4% to $8.8 billion.
Net investment income amounted to $884 million, increased 6.9% year over year.
In the second quarter, P&C underwriting income was $1.2 billion, rebounding from the year-ago loss of $0.9 billion.
Chubb incurred $226 million of after-tax catastrophe losses, net of reinsurance and including reinstatement premiums in the second quarter, narrower than the year-ago loss of $1.5 billion.
Combined ratio improved 2680 basis points (bps) year over year to 85.5 in the quarter under review.
Segmental Update
North America Commercial P&C Insurance: Net premiums written increased 15.2% from the prior-year quarter to $4.3 billion. Combined ratio improved 3420 bps to 83.1.
North America Personal P&C Insurance: Net premiums written increased 2.6% from the prior-year quarter to $1.4 billion. Combined ratio improved 40 bps to 79.2.
North America Agricultural Insurance: Net premiums written improved 11% year over year to $512 million. Combined ratio improved 310 bps to 90.9.
Overseas General Insurance: Net premiums written advanced 23.6% from the year-ago quarter to $2.5 billion. Combined ratio improved 230 bps to 88.7.
Global Reinsurance: Net premiums written increased 32.4% year over year to $274 million. Combined ratio deteriorated 1000 bps to 86.6
Life Insurance: Net premiums written dipped 0.7% year over year to $615 million.
Financial Update
As of Jun 30, 2021, cash balance of $1.8 billion improved 5.5% from the figure at 2020 end.
Total shareholders’ equity increased about 1% from the level at 2020 end to $60.1 billion as of Jun 30, 2021.
Book value per share as of Jun 30, 2021 was $136.90, up 3.8% from the figure as of Dec 31, 2020.
Core operating return on equity (ROE) came in at 11.5% in the quarter under consideration.
During the quarter, operating cash flow totaled $3.1 billion.
Capital Deployment
In the quarter, the company bought back shares worth $2.27 billion including share repurchases of $1.92 billion and dividends of $352 million.
Zacks Rank
Chubb currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
Among other insurers that have already reported their second-quarter results, the bottom line at The Progressive Corporation (PGR - Free Report) , The Travelers Companies’ (TRV - Free Report) and RLI Corp (RLI - Free Report) beat the respective Zacks Consensus Estimate.
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Chubb Limited (CB - Free Report) reported second-quarter 2021 core operating income of $3.62 per share, which surpassed the Zacks Consensus Estimate by 22.3% on the back of improved premium revenues. The bottom line rebounded from the year-ago loss of 52 cents per share.
The company’s results benefited from highest organic P&C growth in over 15 years, driven by commercial P&C businesses and supported by continued robust commercial P&C pricing. The quarter marked record core operating earnings and underwriting results.
Chubb Limited Price, Consensus and EPS Surprise
Quarter in Detail
Net premiums written climbed 14.3% year over year to $9.5 billion in the quarter. Net premiums earned improved 8.4% to $8.8 billion.
Net investment income amounted to $884 million, increased 6.9% year over year.
In the second quarter, P&C underwriting income was $1.2 billion, rebounding from the year-ago loss of $0.9 billion.
Chubb incurred $226 million of after-tax catastrophe losses, net of reinsurance and including reinstatement premiums in the second quarter, narrower than the year-ago loss of $1.5 billion.
Combined ratio improved 2680 basis points (bps) year over year to 85.5 in the quarter under review.
Segmental Update
North America Commercial P&C Insurance: Net premiums written increased 15.2% from the prior-year quarter to $4.3 billion. Combined ratio improved 3420 bps to 83.1.
North America Personal P&C Insurance: Net premiums written increased 2.6% from the prior-year quarter to $1.4 billion. Combined ratio improved 40 bps to 79.2.
North America Agricultural Insurance: Net premiums written improved 11% year over year to $512 million. Combined ratio improved 310 bps to 90.9.
Overseas General Insurance: Net premiums written advanced 23.6% from the year-ago quarter to $2.5 billion. Combined ratio improved 230 bps to 88.7.
Global Reinsurance: Net premiums written increased 32.4% year over year to $274 million. Combined ratio deteriorated 1000 bps to 86.6
Life Insurance: Net premiums written dipped 0.7% year over year to $615 million.
Financial Update
As of Jun 30, 2021, cash balance of $1.8 billion improved 5.5% from the figure at 2020 end.
Total shareholders’ equity increased about 1% from the level at 2020 end to $60.1 billion as of Jun 30, 2021.
Book value per share as of Jun 30, 2021 was $136.90, up 3.8% from the figure as of Dec 31, 2020.
Core operating return on equity (ROE) came in at 11.5% in the quarter under consideration.
During the quarter, operating cash flow totaled $3.1 billion.
Capital Deployment
In the quarter, the company bought back shares worth $2.27 billion including share repurchases of $1.92 billion and dividends of $352 million.
Zacks Rank
Chubb currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
Among other insurers that have already reported their second-quarter results, the bottom line at The Progressive Corporation (PGR - Free Report) , The Travelers Companies’ (TRV - Free Report) and RLI Corp (RLI - Free Report) beat the respective Zacks Consensus Estimate.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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