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Hartford Financial (HIG) to Post Q3 Earnings: What's in Store?
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The Hartford Financial Services Group, Inc. (HIG - Free Report) is slated to report third-quarter 2022 results on Oct 27, after the closing bell.
Q3 Estimates
The Zacks Consensus Estimate for Hartford Financial’s third-quarter earnings per share is pegged at $1.29, indicating an improvement of 2.4% from the prior-year quarter’s reported figure.
The consensus mark for revenues stands at $3.8 billion, suggesting 1.8% growth from the year-ago quarter’s reported number.
Earnings Surprise History
Hartford Financial boasts an impressive earnings surprise history. Its bottom line beat estimates in each of the trailing four quarters, the average being 34.08%. This is depicted in the chart below:
The Hartford Financial Services Group, Inc. Price and EPS Surprise
In the third quarter, revenues of Hartford Financial are expected to have gained on higher earned premiums from its Commercial Lines. The Commercial Lines is likely to have benefited from rate increases, wider exposure, new business generation and solid retention rates.
The Zacks Consensus Estimate for HIG’s earned premiums from its Commercial Lines is pegged at $2.7 billion (indicating 9.6% growth from the year-ago quarter’s reported figure), while our estimate for the metric stands at $2.6 billion.
Though better auto written premiums are expected to have aided the Personal Lines in the to-be-reported quarter, continued inflationary pressure is likely to have pushed up expenses for the auto business in the form of higher used car prices or supply-chain or wage pressures.
The consensus mark for Personal Lines’ earned premiums stands at $733 million, suggesting a 1.5% decline from the prior-year quarter’s reported number. Our estimate for the metric stands at $753.2 million.
Improved fully-insured on-going premiums, robust sales driven by acquisition of new cases and solid enrolment might contribute to the strong quarterly results of the Group Benefits business for the third quarter. The Zacks Consensus Estimate for net earned premiums of the business is pegged at $1.4 billion, indicating a 5.5% rise from the year-ago quarter’s reported figure. The Group Benefits business might have reaped higher profits from lower mortality in group disability business.
Additionally, Hartford Financial’s net investment income is likely to have been driven by rising interest rates in the third quarter.
While underwriting results of HIG’s Commercial Lines are expected to have gained on reduced catastrophe losses and a better expense ratio, elevated auto loss costs are likely to have deteriorated the combined ratio of the Personal Lines.
The Zacks Consensus Estimate for the combined ratio of Hartford Financial’s Commercial Lines is pegged at 94%, indicating an improvement of 700 basis points (bps) from the prior-year quarter’s reported figure. The same for the Personal Lines stands at 104%, suggesting a deterioration of 500 bps from the year-ago quarter’s reported number.
However, HIG’s margins might have borne the brunt of continued investments in developing digital, underwriting and analytic capabilities during the to-be-reported quarter.
What Our Quantitative Model Predicts
Our proven model does not conclusively predict an earnings beat for Hartford Financial this season. 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. However, that is not the case here as elaborated below.
Earnings ESP: Hartford Financial has an Earnings ESP of -6.46% because the Most Accurate Estimate of $1.21 is pegged lower than the Zacks Consensus Estimate of $1.29. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
While an earnings beat looks uncertain for Hartford Financial, here are some companies worth considering from the insurance space, as our model shows that these have the right combination of elements to beat on earnings this time around:
Trean Insurance Group, Inc. has an Earnings ESP of +11.11% and is Zacks #3 Ranked, currently. The Zacks Consensus Estimate for TIG’s third-quarter 2022 earnings is pegged at 9 cents per share, suggesting a decrease of 40% from the prior-year quarter’s reported number.
The bottom line of Trean Insurance beat estimates in one of the trailing four quarters, met the same in another and missed the mark on the remaining two occasions
NMI Holdings, Inc. (NMIH - Free Report) has an Earnings ESP of +2.44% and a Zacks Rank #3, currently. The Zacks Consensus Estimate for NMIH’s third-quarter 2022 earnings is pegged at 82 cents per share, indicating a 15.5% increase from the prior-year quarter’s reported figure.
NMIH’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 4.30%.
Enact Holdings, Inc. (ACT - Free Report) has an Earnings ESP of +1.70% and a Zacks Rank of 3, currently. The Zacks Consensus Estimate for ACT’s third-quarter 2022 earnings is pegged at 89 cents per share, indicating a 6% increase from the prior-year quarter’s reported figure.
Enact Holdings’ bottom line beat earnings estimates in each of the trailing four quarters, the average surprise being 20.65%.
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Hartford Financial (HIG) to Post Q3 Earnings: What's in Store?
The Hartford Financial Services Group, Inc. (HIG - Free Report) is slated to report third-quarter 2022 results on Oct 27, after the closing bell.
Q3 Estimates
The Zacks Consensus Estimate for Hartford Financial’s third-quarter earnings per share is pegged at $1.29, indicating an improvement of 2.4% from the prior-year quarter’s reported figure.
The consensus mark for revenues stands at $3.8 billion, suggesting 1.8% growth from the year-ago quarter’s reported number.
Earnings Surprise History
Hartford Financial boasts an impressive earnings surprise history. Its bottom line beat estimates in each of the trailing four quarters, the average being 34.08%. This is depicted in the chart below:
The Hartford Financial Services Group, Inc. Price and EPS Surprise
The Hartford Financial Services Group, Inc. price-eps-surprise | The Hartford Financial Services Group, Inc. Quote
Factors to Note
In the third quarter, revenues of Hartford Financial are expected to have gained on higher earned premiums from its Commercial Lines. The Commercial Lines is likely to have benefited from rate increases, wider exposure, new business generation and solid retention rates.
The Zacks Consensus Estimate for HIG’s earned premiums from its Commercial Lines is pegged at $2.7 billion (indicating 9.6% growth from the year-ago quarter’s reported figure), while our estimate for the metric stands at $2.6 billion.
Though better auto written premiums are expected to have aided the Personal Lines in the to-be-reported quarter, continued inflationary pressure is likely to have pushed up expenses for the auto business in the form of higher used car prices or supply-chain or wage pressures.
The consensus mark for Personal Lines’ earned premiums stands at $733 million, suggesting a 1.5% decline from the prior-year quarter’s reported number. Our estimate for the metric stands at $753.2 million.
Improved fully-insured on-going premiums, robust sales driven by acquisition of new cases and solid enrolment might contribute to the strong quarterly results of the Group Benefits business for the third quarter. The Zacks Consensus Estimate for net earned premiums of the business is pegged at $1.4 billion, indicating a 5.5% rise from the year-ago quarter’s reported figure. The Group Benefits business might have reaped higher profits from lower mortality in group disability business.
Additionally, Hartford Financial’s net investment income is likely to have been driven by rising interest rates in the third quarter.
While underwriting results of HIG’s Commercial Lines are expected to have gained on reduced catastrophe losses and a better expense ratio, elevated auto loss costs are likely to have deteriorated the combined ratio of the Personal Lines.
The Zacks Consensus Estimate for the combined ratio of Hartford Financial’s Commercial Lines is pegged at 94%, indicating an improvement of 700 basis points (bps) from the prior-year quarter’s reported figure. The same for the Personal Lines stands at 104%, suggesting a deterioration of 500 bps from the year-ago quarter’s reported number.
However, HIG’s margins might have borne the brunt of continued investments in developing digital, underwriting and analytic capabilities during the to-be-reported quarter.
What Our Quantitative Model Predicts
Our proven model does not conclusively predict an earnings beat for Hartford Financial this season. 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. However, that is not the case here as elaborated below.
Earnings ESP: Hartford Financial has an Earnings ESP of -6.46% because the Most Accurate Estimate of $1.21 is pegged lower than the Zacks Consensus Estimate of $1.29. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Hartford Financial currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks to Consider
While an earnings beat looks uncertain for Hartford Financial, here are some companies worth considering from the insurance space, as our model shows that these have the right combination of elements to beat on earnings this time around:
Trean Insurance Group, Inc. has an Earnings ESP of +11.11% and is Zacks #3 Ranked, currently. The Zacks Consensus Estimate for TIG’s third-quarter 2022 earnings is pegged at 9 cents per share, suggesting a decrease of 40% from the prior-year quarter’s reported number.
The bottom line of Trean Insurance beat estimates in one of the trailing four quarters, met the same in another and missed the mark on the remaining two occasions
NMI Holdings, Inc. (NMIH - Free Report) has an Earnings ESP of +2.44% and a Zacks Rank #3, currently. The Zacks Consensus Estimate for NMIH’s third-quarter 2022 earnings is pegged at 82 cents per share, indicating a 15.5% increase from the prior-year quarter’s reported figure.
NMIH’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 4.30%.
Enact Holdings, Inc. (ACT - Free Report) has an Earnings ESP of +1.70% and a Zacks Rank of 3, currently. The Zacks Consensus Estimate for ACT’s third-quarter 2022 earnings is pegged at 89 cents per share, indicating a 6% increase from the prior-year quarter’s reported figure.
Enact Holdings’ bottom line beat earnings estimates in each of the trailing four quarters, the average surprise being 20.65%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.