HCI Group (HCI - Free Report) reported first-quarter 2023 earnings of $1.50 per share that beat the Zacks Consensus Estimate of 9 cents per share. Quarterly earnings increased more than fourfold year over year.
The results reflect better performance at TypTap Insurance Company.
Behind the Headlines
Gross premiums earned of $180.1 million increased 0.7% year over year, reflecting a higher average premium per policy.
Net premiums earned increased 0.6% year over year to $180.1 million.
Operating revenues increased 1.6% year over year to about $129 million on account of the rise in net premiums earned, net investment income and policy fee income. The top line beat the Zacks Consensus Estimate by 9.1%.
Net investment income was $17.7 million, up more than three-fold, reflecting higher yields on fixed maturity securities, cash, and cash equivalents as well as a gain of $8.9 million from the sale of two real estate investment properties at Greenleaf.
Total expenses decreased 13.9% year over year to $105.9 million due to increased losses and loss adjustment expenses, policy acquisition and other underwriting expenses and general and administrative personnel expenses.
Losses and loss adjustment expenses were $60.6 million, down 16.6% year over year. Losses and loss adjustment expenses as a percent of gross premiums earned or gross loss ratio improved to 33.6% from 40.6% in the year-ago quarter.
Financial Update
HCI Group exited the quarter with cash and cash equivalents of $302 million, which increased 28.6% from the 2022-end level. Total investments increased 2.4% from 2022 end to $630.3 million at quarter end.
Long-term debt of $196.2 million decreased 7.3% from the 2022-end figure.
As of Mar 31, 2022, total shareholders’ equity totaled $179.9 million, which increased 11.5% from the level at 2021 end.
Book value per share dropped 33.8% from year-end 2022 to $20.97 at first quarter end.
Zacks Rank
HCI Group currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Property and Casualty Insurers
The Travelers Companies (TRV - Free Report) reported first-quarter 2022 core income of $4.11 per share, which beat the Zacks Consensus Estimate of $3.64 and our estimate of $3.41. However, the bottom line decreased 2.6% year over year. Travelers’ total revenues increased 10% from the year-ago quarter to $9.7 billion, primarily driven by higher premiums. The top-line figure however missed the Zacks Consensus Estimate of $9.8 billion.
Net written premiums increased 12% year over year to a record $9.4 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $8.9 billion.
Catastrophe losses totaled $422 million, wider than $36 million pre-tax in the prior-year quarter. Catastrophe losses primarily resulted from severe wind and hail storms in multiple states. Travelers witnessed an underwriting gain of $501 million, down 12.9% year over year. The combined ratio deteriorated 410 bps year over year to 95.4.
The Progressive Corporation’s (PGR - Free Report) first-quarter 2023 earnings per share of 65 cents missed the Zacks Consensus Estimate of $1.44 as well as our estimate of $1.50. The bottom line declined 20.7% year over year.
Operating revenues were about $14.2 billion, up 15.8% year over year. This improvement was driven by a 15% increase in premiums, 18.5% higher fees and other revenues, a 7.1% increase in service revenues and a 73.2% higher investment income. The top line exceeded the Zacks Consensus Estimate of $14.1 billion and our estimate of $13.1 billion.
Net premiums earned grew 15% to $13.5 billion and beat our estimate of $12.6 billion. The combined ratio deteriorated 450 bps from the prior-year quarter’s level to 99.
RLI Corp. (RLI - Free Report) reported first-quarter 2023 operating earnings of $1.63 per share, beating the Zacks Consensus Estimate by 34.7%. The bottom line improved 14% from the prior-year quarter. Operating revenues for the reported quarter were $335 million, up 19.4% year over year, driven by 14.3% higher net premiums earned and 51.5% higher net investment income. The top line however missed the Zacks Consensus Estimate by 2.2%.
Gross premiums written increased 15.6% year over year to $415 million. This uptick can be attributed to the solid performance of the Casualty (up 1%), Property (up 45%) and Surety segments (up 13.6%). Underwriting income of $67.9 million increased 14.1%, primarily due to higher profitability in its Property and Casualty segment. Combined ratio remained flat year over year at 77.9.
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HCI Group (HCI - Free Report) reported first-quarter 2023 earnings of $1.50 per share that beat the Zacks Consensus Estimate of 9 cents per share. Quarterly earnings increased more than fourfold year over year.
The results reflect better performance at TypTap Insurance Company.
Behind the Headlines
Gross premiums earned of $180.1 million increased 0.7% year over year, reflecting a higher average premium per policy.
Net premiums earned increased 0.6% year over year to $180.1 million.
Operating revenues increased 1.6% year over year to about $129 million on account of the rise in net premiums earned, net investment income and policy fee income. The top line beat the Zacks Consensus Estimate by 9.1%.
Net investment income was $17.7 million, up more than three-fold, reflecting higher yields on fixed maturity securities, cash, and cash equivalents as well as a gain of $8.9 million from the sale of two real estate investment properties at Greenleaf.
Total expenses decreased 13.9% year over year to $105.9 million due to increased losses and loss adjustment expenses, policy acquisition and other underwriting expenses and general and administrative personnel expenses.
Losses and loss adjustment expenses were $60.6 million, down 16.6% year over year. Losses and loss adjustment expenses as a percent of gross premiums earned or gross loss ratio improved to 33.6% from 40.6% in the year-ago quarter.
Financial Update
HCI Group exited the quarter with cash and cash equivalents of $302 million, which increased 28.6% from the 2022-end level. Total investments increased 2.4% from 2022 end to $630.3 million at quarter end.
Long-term debt of $196.2 million decreased 7.3% from the 2022-end figure.
As of Mar 31, 2022, total shareholders’ equity totaled $179.9 million, which increased 11.5% from the level at 2021 end.
Book value per share dropped 33.8% from year-end 2022 to $20.97 at first quarter end.
Zacks Rank
HCI Group currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Property and Casualty Insurers
The Travelers Companies (TRV - Free Report) reported first-quarter 2022 core income of $4.11 per share, which beat the Zacks Consensus Estimate of $3.64 and our estimate of $3.41. However, the bottom line decreased 2.6% year over year. Travelers’ total revenues increased 10% from the year-ago quarter to $9.7 billion, primarily driven by higher premiums. The top-line figure however missed the Zacks Consensus Estimate of $9.8 billion.
Net written premiums increased 12% year over year to a record $9.4 billion, driven by strong growth across all three segments. The figure was higher than our estimate of $8.9 billion.
Catastrophe losses totaled $422 million, wider than $36 million pre-tax in the prior-year quarter. Catastrophe losses primarily resulted from severe wind and hail storms in multiple states. Travelers witnessed an underwriting gain of $501 million, down 12.9% year over year. The combined ratio deteriorated 410 bps year over year to 95.4.
The Progressive Corporation’s (PGR - Free Report) first-quarter 2023 earnings per share of 65 cents missed the Zacks Consensus Estimate of $1.44 as well as our estimate of $1.50. The bottom line declined 20.7% year over year.
Operating revenues were about $14.2 billion, up 15.8% year over year. This improvement was driven by a 15% increase in premiums, 18.5% higher fees and other revenues, a 7.1% increase in service revenues and a 73.2% higher investment income. The top line exceeded the Zacks Consensus Estimate of $14.1 billion and our estimate of $13.1 billion.
Net premiums earned grew 15% to $13.5 billion and beat our estimate of $12.6 billion. The combined ratio deteriorated 450 bps from the prior-year quarter’s level to 99.
RLI Corp. (RLI - Free Report) reported first-quarter 2023 operating earnings of $1.63 per share, beating the Zacks Consensus Estimate by 34.7%. The bottom line improved 14% from the prior-year quarter. Operating revenues for the reported quarter were $335 million, up 19.4% year over year, driven by 14.3% higher net premiums earned and 51.5% higher net investment income. The top line however missed the Zacks Consensus Estimate by 2.2%.
Gross premiums written increased 15.6% year over year to $415 million. This uptick can be attributed to the solid performance of the Casualty (up 1%), Property (up 45%) and Surety segments (up 13.6%). Underwriting income of $67.9 million increased 14.1%, primarily due to higher profitability in its Property and Casualty segment. Combined ratio remained flat year over year at 77.9.
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Zacks Senior Stock Strategist, Kevin Cook names 5 hand-picked stocks with sky-high growth potential in a brilliant sector of Artificial Intelligence. By 2030, the AI industry is predicted to have an internet and iPhone-scale economic impact of $15.7 Trillion.
Today you can invest in the wave of the future, an automation that answers follow-up questions … admits mistakes … challenges incorrect premises … rejects inappropriate requests. As one of the selected companies puts it, “Automation frees people from the mundane so they can accomplish the miraculous.”
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