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Chubb Limited

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Chubb’s first-quarter 2018 earnings beat the Zacks Consensus Estimate but deteriorated year over year on higher catastrophe loss. Though the bottom line was weighed by 64 cents in cat loss, net investment income was solid while premium revenue and commercial P&C pricing improved across many of its businesses lines. Chubb stands a good chance of leading the P&C space, benefiting from compelling products as well as services. Its inorganic growth story is impressive, helping it achieve a higher long-term ROE. A strong capital position aids Chubb to boost shareholders’ value and invest in strategic initiatives to drive growth. The company is on track to achieve annual run-rate integration-related savings of $875 million by the end of 2018. But, exposure to cat loss induces volatility in underwriting profitability. Escalating expenses too weigh on margin expansion. Shares of Chubb have underperformed the industry year to date.


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