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ProAssurance (PRA) to Post Q1 Earnings: What's in the Cards?
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ProAssurance Corporation (PRA - Free Report) is slated to report first-quarter 2023 earnings on May 9, after the closing bell. The company’s earnings beat estimates in the last reported quarter.
What Do the Estimates Say?
The Zacks Consensus Estimate for first-quarter earnings of 15 cents per share indicates a 7.1% increase from the year-ago quarter’s reported earnings of 14 cents. The consensus estimate has witnessed no movement in the past week.
The Zacks Consensus Estimate for first-quarter revenues is pegged at around $273.9 million, suggesting a fall of 5.2% from the year-ago quarter’s reported figure. We expect revenues to witness a 10.7% decline from the year-ago quarter.
ProAssurance’s earnings beat estimates in two of the trailing four quarters, while it missed on the other occasions, the average being 50.2%. This is depicted in the graph below.
Before we get into what to expect for the to-be-reported quarter in detail, it is worth looking at PRA’s previous-quarter performance.
Q4 Earnings Rewind
In the last reported quarter, this property and casualty insurance reported adjusted operating earnings of 6 cents per share, beating the Zacks Consensus Estimate by 20%. An increase in net investment income benefited fourth-quarter results. Also, strong policyholder retention and its ability to charge higher premiums supported the company. However, the ongoing inflationary pressure on expenses and lower net premiums earned partially offset the positives.
Now let’s see how things have shaped up before the first-quarter earnings announcement.
Factors to Note
The Zacks Consensus Estimate for net premiums earned indicates an 8.3% year-over-year decline while our estimate suggests a 13.5% fall. PRA’s re-underwriting efforts are likely to have affected the top line.
The consensus mark for combined ratio is pegged at 107% while our estimate predicts 107.7% compared with the year-ago level of 106%. A higher combined ratio suggests that the company had less premium left after claim settlements. This is expected to have positioned the company for a year-over-year decline, making an earnings beat uncertain.
The bottom line of the company is likely to have suffered a setback due to escalating underwriting, policy acquisition and operating expenses and dividend expense. The Zacks Consensus Estimate for Underwriting expense ratio indicates an 11% deterioration from the year-ago period while our estimate suggests a 13.3% deterioration.
Further, the Zacks Consensus Estimate for Workers’ Compensation Insurance revenues indicates a 0.2% year-over-year fall. Also, the consensus mark for Specialty P&C Segment revenues predicts a 9.5% decline from a year ago and our estimate suggests a 15% decline.
The negatives are expected to have been partially offset by higher investment income, thanks to the high interest rate environment. The Zacks Consensus Estimate for net investment income indicates a 33% year-over-year increase while our estimate suggests 18.3% growth.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for ProAssurance this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you will see below.
Earnings ESP: The company has an Earnings ESP of 0.00%. The Most Accurate Estimate is currently pegged at 15 cents per share, in line with the Zacks Consensus Estimate.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: ProAssurance currently carries a Zacks Rank #3.
Stocks to Consider
Here are some companies from the Finance space, which according to our model, have the right combination of elements to beat on earnings this time around:
AEL’s earnings beat estimates in two of the last four reported quarters and missed the other two.
Owl Rock Capital Corporation has an Earnings ESP of +0.47% and a Zacks Rank of 2. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at 43 cents, indicating an increase of 38.7% from the year-ago reported figure.
ORCC’s earnings beat estimates in three of the last four reported quarters and missed on the other occasion.
GCM Grosvenor Inc. (GCMG - Free Report) has an Earnings ESP of +6.67% and a Zacks Rank of 3. The Zacks Consensus Estimate for first-quarter 2023 earnings stands at 11 cents, implying a decrease of 38.9% from the year-ago reported quarter.
GCMG’s earnings beat estimates in two of the last four reported quarters and missed the other two.
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ProAssurance (PRA) to Post Q1 Earnings: What's in the Cards?
ProAssurance Corporation (PRA - Free Report) is slated to report first-quarter 2023 earnings on May 9, after the closing bell. The company’s earnings beat estimates in the last reported quarter.
What Do the Estimates Say?
The Zacks Consensus Estimate for first-quarter earnings of 15 cents per share indicates a 7.1% increase from the year-ago quarter’s reported earnings of 14 cents. The consensus estimate has witnessed no movement in the past week.
The Zacks Consensus Estimate for first-quarter revenues is pegged at around $273.9 million, suggesting a fall of 5.2% from the year-ago quarter’s reported figure. We expect revenues to witness a 10.7% decline from the year-ago quarter.
ProAssurance’s earnings beat estimates in two of the trailing four quarters, while it missed on the other occasions, the average being 50.2%. This is depicted in the graph below.
ProAssurance Corporation Price and EPS Surprise
ProAssurance Corporation price-eps-surprise | ProAssurance Corporation Quote
Before we get into what to expect for the to-be-reported quarter in detail, it is worth looking at PRA’s previous-quarter performance.
Q4 Earnings Rewind
In the last reported quarter, this property and casualty insurance reported adjusted operating earnings of 6 cents per share, beating the Zacks Consensus Estimate by 20%. An increase in net investment income benefited fourth-quarter results. Also, strong policyholder retention and its ability to charge higher premiums supported the company. However, the ongoing inflationary pressure on expenses and lower net premiums earned partially offset the positives.
Now let’s see how things have shaped up before the first-quarter earnings announcement.
Factors to Note
The Zacks Consensus Estimate for net premiums earned indicates an 8.3% year-over-year decline while our estimate suggests a 13.5% fall. PRA’s re-underwriting efforts are likely to have affected the top line.
The consensus mark for combined ratio is pegged at 107% while our estimate predicts 107.7% compared with the year-ago level of 106%. A higher combined ratio suggests that the company had less premium left after claim settlements. This is expected to have positioned the company for a year-over-year decline, making an earnings beat uncertain.
The bottom line of the company is likely to have suffered a setback due to escalating underwriting, policy acquisition and operating expenses and dividend expense. The Zacks Consensus Estimate for Underwriting expense ratio indicates an 11% deterioration from the year-ago period while our estimate suggests a 13.3% deterioration.
Further, the Zacks Consensus Estimate for Workers’ Compensation Insurance revenues indicates a 0.2% year-over-year fall. Also, the consensus mark for Specialty P&C Segment revenues predicts a 9.5% decline from a year ago and our estimate suggests a 15% decline.
The negatives are expected to have been partially offset by higher investment income, thanks to the high interest rate environment. The Zacks Consensus Estimate for net investment income indicates a 33% year-over-year increase while our estimate suggests 18.3% growth.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for ProAssurance this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you will see below.
Earnings ESP: The company has an Earnings ESP of 0.00%. The Most Accurate Estimate is currently pegged at 15 cents per share, in line with the Zacks Consensus Estimate.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: ProAssurance currently carries a Zacks Rank #3.
Stocks to Consider
Here are some companies from the Finance space, which according to our model, have the right combination of elements to beat on earnings this time around:
American Equity Investment Life Holding Company (AEL - Free Report) has an Earnings ESP of +3.26% and a Zacks Rank of 3. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at $1.15, indicating an increase of 25% from the year-ago reported figure. You can see the complete list of today’s Zacks #1 Rank stocks here.
AEL’s earnings beat estimates in two of the last four reported quarters and missed the other two.
Owl Rock Capital Corporation has an Earnings ESP of +0.47% and a Zacks Rank of 2. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at 43 cents, indicating an increase of 38.7% from the year-ago reported figure.
ORCC’s earnings beat estimates in three of the last four reported quarters and missed on the other occasion.
GCM Grosvenor Inc. (GCMG - Free Report) has an Earnings ESP of +6.67% and a Zacks Rank of 3. The Zacks Consensus Estimate for first-quarter 2023 earnings stands at 11 cents, implying a decrease of 38.9% from the year-ago reported quarter.
GCMG’s earnings beat estimates in two of the last four reported quarters and missed the other two.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.