We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The Hanover Insurance (THG) Rising Since Q4 Earnings Beat
Read MoreHide Full Article
The Hanover Insurance Group (THG - Free Report) reported adjusted fourth-quarter 2021 earnings of $3.38 per share, which beat the Zacks Consensus Estimate by 35.2%. Moreover, the bottom line increased 12% year over year.
The company’s results reflected higher net premiums written as well as an increase in net investment income, partly offset by higher expenses.
Shares gained 4.6% in the last two days trading session, reflecting the outperformance.
The Hanover Insurance Group, Inc. Price, Consensus and EPS Surprise
In 2021, The Hanover Insurance delivered an operating income of $8.73 per share, which improved 6.3% year over year.
Total operating revenues of $5.1 billion increased 5.9% year over year.
Quarterly Operational Update
Total operating revenues of $1.3 billion outpaced the Zacks Consensus Estimate by 0.9%. The top line also rose 7.8% year over year on higher net premiums earned and net investment income.
Net premiums written increased 9.2% year over year to about $1.2 billion, largely driven by higher premiums in the Commercial Lines segment and the Personal Lines segment.
Net investment income increased 13.2% year over year to nearly $79.5 million, primarily due to unusually high income from limited partnerships, and to a lesser degree, continued investment of higher operating cash flow. The upside was partially offset by lower new money yields.
Total expenses in the quarter under review increased 7.8% year over year to $1.2 billion, attributable to higher losses and loss adjustment expenses, amortization of deferred acquisition costs and other operating expenses.
The combined ratio deteriorated 50 basis points (bps) to 92.9%.
Segment Results
Commercial Lines: Net premiums written improved 9.6% year over year to $712.7 million, driven primarily by rate and exposure increases.
The combined ratio improved 80 basis points year over year to 90.7%. Catastrophe losses increased 55% to $15.5 million.
Personal Lines: Net premiums written improved 8.7% year over year to $502.2 million, driven primarily by increased new business.
The combined ratio deteriorated 280 basis points year over year to 96.2%. Catastrophe losses decreased 6.4% to $23.5 million.
Financial Update
The Hanover Insurance exited 2021 with cash and cash equivalents of $230.9 million, up 91.4% over the level at 2020 end.
Debts were $781.6 million at 2021 end, up 0.1% from 2020-end level.
Book value per share increased 0.7% year over year to $88.59 as of Dec 31, 2021. The increase was driven by net income, partially offset by a decline in unrealized gains in the company’s fixed income portfolio.
Operating return on equity totaled 16.8% in the fourth quarter.
Dividend Update
The Hanover Insurance announced a dividend of 75 cents per share in the reported quarter, which represents an increase of 7.1%. The company paid ordinary dividends of $102.2 million over the past year.
Of the insurance industry players who have reported fourth-quarter results so far, The Travelers Companies (TRV - Free Report) , RenaissanceRe Holdings Ltd. (RNR - Free Report) and The Progressive Corporation (PGR - Free Report) beat the Zacks Consensus Estimate for earnings.
Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and increased 6% year over year. Total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion.
Travelers’ net written premiums increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 bps year over year to 88.
RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from the year-ago loss of $1.59. Total revenues of $1.39 billion dipped 0.1% year over year.
RenaissanceRe’s gross premiums written surged 40.4% year over year to $1.3 billion. The combined ratio improved 3530 bps year over year to 79.4.
Progressive’s earnings of $1.05 per share beat the Zacks Consensus Estimate of 99 cents but declined 43.2% from the year-ago quarter.
Progressive’s net premiums written were $10.7 billion in the quarter, up 13% from $9.5 billion a year ago. The combined ratio deteriorated 630 bps from the prior-year quarter to 94.7.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
The Hanover Insurance (THG) Rising Since Q4 Earnings Beat
The Hanover Insurance Group (THG - Free Report) reported adjusted fourth-quarter 2021 earnings of $3.38 per share, which beat the Zacks Consensus Estimate by 35.2%. Moreover, the bottom line increased 12% year over year.
The company’s results reflected higher net premiums written as well as an increase in net investment income, partly offset by higher expenses.
Shares gained 4.6% in the last two days trading session, reflecting the outperformance.
The Hanover Insurance Group, Inc. Price, Consensus and EPS Surprise
The Hanover Insurance Group, Inc. price-consensus-eps-surprise-chart | The Hanover Insurance Group, Inc. Quote
Full-Year Highlights
In 2021, The Hanover Insurance delivered an operating income of $8.73 per share, which improved 6.3% year over year.
Total operating revenues of $5.1 billion increased 5.9% year over year.
Quarterly Operational Update
Total operating revenues of $1.3 billion outpaced the Zacks Consensus Estimate by 0.9%. The top line also rose 7.8% year over year on higher net premiums earned and net investment income.
Net premiums written increased 9.2% year over year to about $1.2 billion, largely driven by higher premiums in the Commercial Lines segment and the Personal Lines segment.
Net investment income increased 13.2% year over year to nearly $79.5 million, primarily due to unusually high income from limited partnerships, and to a lesser degree, continued investment of higher operating cash flow. The upside was partially offset by lower new money yields.
Total expenses in the quarter under review increased 7.8% year over year to $1.2 billion, attributable to higher losses and loss adjustment expenses, amortization of deferred acquisition costs and other operating expenses.
The combined ratio deteriorated 50 basis points (bps) to 92.9%.
Segment Results
Commercial Lines: Net premiums written improved 9.6% year over year to $712.7 million, driven primarily by rate and exposure increases.
The combined ratio improved 80 basis points year over year to 90.7%. Catastrophe losses increased 55% to $15.5 million.
Personal Lines: Net premiums written improved 8.7% year over year to $502.2 million, driven primarily by increased new business.
The combined ratio deteriorated 280 basis points year over year to 96.2%. Catastrophe losses decreased 6.4% to $23.5 million.
Financial Update
The Hanover Insurance exited 2021 with cash and cash equivalents of $230.9 million, up 91.4% over the level at 2020 end.
Debts were $781.6 million at 2021 end, up 0.1% from 2020-end level.
Book value per share increased 0.7% year over year to $88.59 as of Dec 31, 2021. The increase was driven by net income, partially offset by a decline in unrealized gains in the company’s fixed income portfolio.
Operating return on equity totaled 16.8% in the fourth quarter.
Dividend Update
The Hanover Insurance announced a dividend of 75 cents per share in the reported quarter, which represents an increase of 7.1%. The company paid ordinary dividends of $102.2 million over the past year.
Zacks Rank
The Hanover Insurance 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 who have reported fourth-quarter results so far, The Travelers Companies (TRV - Free Report) , RenaissanceRe Holdings Ltd. (RNR - Free Report) and The Progressive Corporation (PGR - Free Report) beat the Zacks Consensus Estimate for earnings.
Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and increased 6% year over year. Total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion.
Travelers’ net written premiums increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 bps year over year to 88.
RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from the year-ago loss of $1.59. Total revenues of $1.39 billion dipped 0.1% year over year.
RenaissanceRe’s gross premiums written surged 40.4% year over year to $1.3 billion. The combined ratio improved 3530 bps year over year to 79.4.
Progressive’s earnings of $1.05 per share beat the Zacks Consensus Estimate of 99 cents but declined 43.2% from the year-ago quarter.
Progressive’s net premiums written were $10.7 billion in the quarter, up 13% from $9.5 billion a year ago. The combined ratio deteriorated 630 bps from the prior-year quarter to 94.7.