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Chubb's (CB) Q1 Earnings Top Estimates, Premiums Rise Y/Y
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Chubb Limited (CB - Free Report) reported first-quarter 2021 core operating income of $2.52 per share, which surpassed the Zacks Consensus Estimate by 2.9% on the back of improved premium revenues. However, the bottom line plunged 6% from the year-ago quarter.
The company’s results benefited from uptick in global premium revenues and double-digit renewal rate change across its commercial property and casualty (P&C) lines, and higher net investment income. However, the upside was partly offset by dip in premiums across the company’s consumer lines and increased catastrophe losses stemming from storm losses across the United States.
Quarter in Detail
Net premiums written climbed 8.6% year over year to $8.7 billion in the quarter. Net premiums earned improved 5.5% to $8.2 billion.
Net investment income amounted to $863 million, which inched up 0.2% year over year.
In the first quarter, P&C underwriting income declined 20% year over to $622 million. Global P&C’s underwriting income excluding Agriculture was $612 million, which slumped 19.8% year over year.
Chubb incurred $570 million of after-tax catastrophe losses, net of reinsurance and including reinstatement premiums in the first quarter, which increased to nearly three-fold from the prior-year quarter.
Combined ratio deteriorated 270 basis points (bps) year over year to 91.8% in the quarter under review.
North America Commercial P&C Insurance: Net premiums written grew 12.7% year over year to $3.7 billion. Combined ratio deteriorated 380 bps to 90.6%.
North America Personal P&C Insurance: Net premiums written inched down 0.8% from the prior-year quarter to $1.1 billion. Combined ratio deteriorated 1210 bps to 95.1%.
North America Agricultural Insurance: Net premiums written improved 16.5% year over year to $183 million. Combined ratio deteriorated 610 bps to 90.9%.
Overseas General Insurance: Net premiums written advanced 11.2% from the year-ago quarter to $2.9 billion. Combined ratio improved 480 bps to 88.7%.
Global Reinsurance: Net premiums written plunged 5.1% year over year to $207 million. Combined ratio deteriorated 2030 bps to 96.4%.
Life Insurance: Net premiums written dipped 3.8% year over year to $620 million.
Financial Update
As of Mar 31, 2021, cash balance of $1.7 billion plunged 3.6% from the figure at 2020 end.
Total shareholders’ equity inched down 0.6% from the level at 2020 end to $59.1 billion as of Mar 31, 2021.
Book value per share as of Mar 31, 2021 was $131.37, down 0.4% from the figure as of Dec 31, 2020.
Core operating return on equity (ROE) came in at 8.2% in the quarter under consideration.
During the quarter, operating cash flow totaled $2.1 billion.
Share Repurchase Update
In the quarter, the company bought back shares worth $519 million.
Of the insurance industry players that have reported first-quarter results so far, the bottom line of W. R. Berkley Corporation (WRB - Free Report) , The Travelers Companies, Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) beat the Zacks Consensus Estimate.
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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.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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Chubb's (CB) Q1 Earnings Top Estimates, Premiums Rise Y/Y
Chubb Limited (CB - Free Report) reported first-quarter 2021 core operating income of $2.52 per share, which surpassed the Zacks Consensus Estimate by 2.9% on the back of improved premium revenues. However, the bottom line plunged 6% from the year-ago quarter.
The company’s results benefited from uptick in global premium revenues and double-digit renewal rate change across its commercial property and casualty (P&C) lines, and higher net investment income. However, the upside was partly offset by dip in premiums across the company’s consumer lines and increased catastrophe losses stemming from storm losses across the United States.
Quarter in Detail
Net premiums written climbed 8.6% year over year to $8.7 billion in the quarter. Net premiums earned improved 5.5% to $8.2 billion.
Net investment income amounted to $863 million, which inched up 0.2% year over year.
In the first quarter, P&C underwriting income declined 20% year over to $622 million. Global P&C’s underwriting income excluding Agriculture was $612 million, which slumped 19.8% year over year.
Chubb incurred $570 million of after-tax catastrophe losses, net of reinsurance and including reinstatement premiums in the first quarter, which increased to nearly three-fold from the prior-year quarter.
Combined ratio deteriorated 270 basis points (bps) year over year to 91.8% in the quarter under review.
Chubb Limited Price, Consensus and EPS Surprise
Chubb Limited price-consensus-eps-surprise-chart | Chubb Limited Quote
Segmental Update
North America Commercial P&C Insurance: Net premiums written grew 12.7% year over year to $3.7 billion. Combined ratio deteriorated 380 bps to 90.6%.
North America Personal P&C Insurance: Net premiums written inched down 0.8% from the prior-year quarter to $1.1 billion. Combined ratio deteriorated 1210 bps to 95.1%.
North America Agricultural Insurance: Net premiums written improved 16.5% year over year to $183 million. Combined ratio deteriorated 610 bps to 90.9%.
Overseas General Insurance: Net premiums written advanced 11.2% from the year-ago quarter to $2.9 billion. Combined ratio improved 480 bps to 88.7%.
Global Reinsurance: Net premiums written plunged 5.1% year over year to $207 million. Combined ratio deteriorated 2030 bps to 96.4%.
Life Insurance: Net premiums written dipped 3.8% year over year to $620 million.
Financial Update
As of Mar 31, 2021, cash balance of $1.7 billion plunged 3.6% from the figure at 2020 end.
Total shareholders’ equity inched down 0.6% from the level at 2020 end to $59.1 billion as of Mar 31, 2021.
Book value per share as of Mar 31, 2021 was $131.37, down 0.4% from the figure as of Dec 31, 2020.
Core operating return on equity (ROE) came in at 8.2% in the quarter under consideration.
During the quarter, operating cash flow totaled $2.1 billion.
Share Repurchase Update
In the quarter, the company bought back shares worth $519 million.
Zacks Rank
Chubb currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
Of the insurance industry players that have reported first-quarter results so far, the bottom line of W. R. Berkley Corporation (WRB - Free Report) , The Travelers Companies, Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) beat the 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.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>