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Is a Beat in Store for Everest Re (EG) This Earnings Season?
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Everest Re Group (EG - Free Report) is slated to report second-quarter 2023 earnings on Jul 26, after market close. The insurer delivered an earnings surprise in three of the last four quarters, missed in one, the average being 10.09%.
Factors to Consider
Premium growth is likely to have been driven by solid performance of its Reinsurance segment, rate increases, exposure growth and strong underwriting. We expect net written premium to increase 14.7% to $3.5 billion in the second quarter.
The Insurance segment is likely to have benefited from balanced and diversified growth across most lines of business and geographies, property and specialty lines, in particular as well as new business and strong renewal retention. We estimate premiums earned to increase 27.7% to $991.9 million in the to-be-reported quarter.
The Reinsurance segment is likely to have benefited from growth in Casualty and Financial Lines, driven by an increase in core casualty clients. EG estimates improvements in ceding commissions to benefit premiums earned. We expect the metric to improve 14.2% to $2.4 billion in the second quarter.
Net investment income is likely to have benefited from higher new money yields and increasing reset in floating rate securities within the fixed income portfolio. We expect net investment income to be $254.5 million, up 12.6% from year ago reported quarter.
Higher net written premiums and net investment income are likely to have boosted the top line in the to-be-reported quarter. The Zacks Consensus Estimate for revenues is currently pegged at $3.6 billion, indicating a 17.7% increase from the year-ago reported figure.
Higher-than-expected cat losses are likely to have weighed on underwriting profitability. Nonetheless, rate increase, exposure growth, prudent underwriting and traditional risk management capabilities are likely to have favored underwriting results and combined ratio in the to-be-reported quarter. We expect the combined ratio to be 91 in the to-be-reported quarter, improving 80 basis points from the year-ago reported quarter.
We estimate underwriting income in the Insurance segment to increase 8.8% to $71.4 million and 37.1% to $239.3 million in the Reinsurance segment in the to-be-reported quarter.
The Zacks Consensus Estimate for Everest Re’s second-quarter earnings is currently pegged at $11.10, indicating an increase of 13.4% from the year-ago quarter’s reported figure.
What the Zacks Model Says
Our proven model predicts an earnings beat for EG this time around. 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.
Earnings ESP: Everest Re has an Earnings ESP of +1.27%. This is because the Most Accurate Estimate of $11.24 is pegged higher than the Zacks Consensus Estimate of $11.10. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Some other insurance stocks with the right combination of elements to deliver an earnings beat this time around are:
Assurant, Inc. (AIZ - Free Report) has an Earnings ESP of +0.52% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for second-quarter 2023 earnings is pegged at $2.60, indicating a year-over-year decline of 11.8%.
AIZ’s earnings beat estimates in three of the last four quarters and missed in the other one.
Arch Capital Group (ACGL - Free Report) has an Earnings ESP of +1.57% and a Zacks Rank of 3. The Zacks Consensus Estimate for second-quarter 2023 earnings is pegged at $1.65 per share, indicating a decrease of 23.1% from the year-ago reported figure.
ACGL’s earnings beat estimates in the last four reported quarters.
Goosehead Insurance (GSHD - Free Report) has an Earnings ESP of +20.81% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for second-quarter 2023 earnings is pegged at 30 cents, indicating a year-over-year increase of 87.5%.
GSHD’s earnings beat estimates in two of the last four quarters and missed in the other two.
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Is a Beat in Store for Everest Re (EG) This Earnings Season?
Everest Re Group (EG - Free Report) is slated to report second-quarter 2023 earnings on Jul 26, after market close. The insurer delivered an earnings surprise in three of the last four quarters, missed in one, the average being 10.09%.
Factors to Consider
Premium growth is likely to have been driven by solid performance of its Reinsurance segment, rate increases, exposure growth and strong underwriting. We expect net written premium to increase 14.7% to $3.5 billion in the second quarter.
The Insurance segment is likely to have benefited from balanced and diversified growth across most lines of business and geographies, property and specialty lines, in particular as well as new business and strong renewal retention. We estimate premiums earned to increase 27.7% to $991.9 million in the to-be-reported quarter.
The Reinsurance segment is likely to have benefited from growth in Casualty and Financial Lines, driven by an increase in core casualty clients. EG estimates improvements in ceding commissions to benefit premiums earned. We expect the metric to improve 14.2% to $2.4 billion in the second quarter.
Net investment income is likely to have benefited from higher new money yields and increasing reset in floating rate securities within the fixed income portfolio. We expect net investment income to be $254.5 million, up 12.6% from year ago reported quarter.
Higher net written premiums and net investment income are likely to have boosted the top line in the to-be-reported quarter. The Zacks Consensus Estimate for revenues is currently pegged at $3.6 billion, indicating a 17.7% increase from the year-ago reported figure.
Higher-than-expected cat losses are likely to have weighed on underwriting profitability. Nonetheless, rate increase, exposure growth, prudent underwriting and traditional risk management capabilities are likely to have favored underwriting results and combined ratio in the to-be-reported quarter. We expect the combined ratio to be 91 in the to-be-reported quarter, improving 80 basis points from the year-ago reported quarter.
We estimate underwriting income in the Insurance segment to increase 8.8% to $71.4 million and 37.1% to $239.3 million in the Reinsurance segment in the to-be-reported quarter.
The Zacks Consensus Estimate for Everest Re’s second-quarter earnings is currently pegged at $11.10, indicating an increase of 13.4% from the year-ago quarter’s reported figure.
What the Zacks Model Says
Our proven model predicts an earnings beat for EG this time around. 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.
Earnings ESP: Everest Re has an Earnings ESP of +1.27%. This is because the Most Accurate Estimate of $11.24 is pegged higher than the Zacks Consensus Estimate of $11.10. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Everest Group, Ltd. Price and EPS Surprise
Everest Group, Ltd. price-eps-surprise | Everest Group, Ltd. Quote
Zacks Rank: Everest Re carries a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks to Consider
Some other insurance stocks with the right combination of elements to deliver an earnings beat this time around are:
Assurant, Inc. (AIZ - Free Report) has an Earnings ESP of +0.52% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for second-quarter 2023 earnings is pegged at $2.60, indicating a year-over-year decline of 11.8%.
AIZ’s earnings beat estimates in three of the last four quarters and missed in the other one.
Arch Capital Group (ACGL - Free Report) has an Earnings ESP of +1.57% and a Zacks Rank of 3. The Zacks Consensus Estimate for second-quarter 2023 earnings is pegged at $1.65 per share, indicating a decrease of 23.1% from the year-ago reported figure.
ACGL’s earnings beat estimates in the last four reported quarters.
Goosehead Insurance (GSHD - Free Report) has an Earnings ESP of +20.81% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for second-quarter 2023 earnings is pegged at 30 cents, indicating a year-over-year increase of 87.5%.
GSHD’s earnings beat estimates in two of the last four quarters and missed in the other two.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.