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Chubb (CB) to Report Q1 Earnings: What's in the Offing?

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Chubb Limited (CB - Free Report) is slated to report first-quarter 2021 results on Apr 27, after market close. The company delivered a negative earnings surprise of 10.80% in the last reported quarter.

Factors to Consider

Premiums in the first quarter are expected to have benefited from positive rate increases, exposure growth, strong renewal retention and continued growth in Chubb Agribusiness unit. The Zacks Consensus Estimate for net premiums written is pegged at $8.5 billion.

Sustained low reinvestment rates on new and reinvested assets are expected to weigh on investment results. However, higher average invested assets is expected to have limited the downside. Chubb estimates adjusted net investment income run rate to be in the range of $890 million to $900 million. The Zacks Consensus Estimate for investment income is pegged at $909 million, indicating 5.6% increase from the year-ago reported figure

The Zacks Consensus Estimate for revenues is pegged at $8.3 billion, indicating a downside of 3.4% from the year-ago reported figure.

Total benefits and expenses are likely to have increased mainly due to loss and loss expenses, policy acquisition costs and policy benefits.

Being one of the world’s largest providers of property and casualty (P&C) insurance and reinsurance and largest publicly traded P&C insurer, it is exposed to losses stemming from cat events. This in turn is likely to have weighed on underwriting profitability. The Zacks Consensus Estimate for underwriting income is pegged at $927 million.

Share buybacks are likely to have aided the bottom line in the reported quarter.

The Zacks Consensus Estimate for first-quarter 2021 earnings of $2.45 per share indicates a decline of 8.6% from the year-ago quarter reported figure.

What the Zacks Model Says

Our proven model does not conclusively predict an earnings beat for Chubb this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case as you can see below.

Earnings ESP: Chubb has an Earnings ESP of -22.19%. This is because the Most Accurate Estimate of $1.91 is pegged lower than the Zacks Consensus Estimate of $2.45. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
 

Chubb Limited Price and EPS Surprise

Chubb Limited Price and EPS Surprise

Chubb Limited price-eps-surprise | Chubb Limited Quote

Zacks Rank: Chubb carries a Zacks Rank #3.

Stocks to Consider

Some insurance stocks with the right combination of elements to come up with an earnings beat this time around are:

The Allstate Corporation (ALL - Free Report) has an Earnings ESP of +2.60% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Palomar Holdings (PLMR - Free Report) has an Earnings ESP of +8.00% and a Zacks Rank #3.

NMI Holdings Inc (NMIH - Free Report) has an Earnings ESP of +4.92% and a Zacks Rank of 2.

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