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Will Everest Group's (EG) Beat Streak Continue in Q4 Earnings?
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Everest Group, Ltd. (EG - Free Report) is slated to report fourth-quarter 2023 earnings on Feb 7, after market close. The insurer delivered an earnings surprise in three of the last four quarters and missed in one, the average being 24.5%.
Factors to Consider
Premium growth is likely to have been driven by the solid performance of its Reinsurance segment, rate increases, exposure growth and strong underwriting. We expect net written premium to increase 8.3% to $3.4 billion in the fourth quarter.
The Insurance segment is likely to have benefited from an increase in property, short tail business, specialty casualty business and other specialty lines of business, as well as new business and strong renewal retention. We estimate premiums earned to increase 19.5% to $3.6 billion in the to-be-reported quarter.
Commission ratio is likely to have gained from the business mix, as well as increased volume of ceding commissions and decreased gross commissions across multiple lines.
The Reinsurance segment is expected to have benefited from widespread growth across business lines and geographies, including marine and aviation, as well as solid international growth, higher property cat premiums and casualty and improved property pro-rata premiums. We expect premiums earned to improve 22.3% to $2.7 billion in the fourth quarter.
Net investment income is likely to have benefited from higher new money yields, investment in floating rate securities and improved assets under management. We expect net investment income to be $407.4 million, up 94% from the year-ago reported quarter.
The top line in the to-be-reported quarter is expected to have gained from higher net written premiums and net investment income. The Zacks Consensus Estimate for revenues is currently pegged at $4.01 billion, indicating a 25.5% increase from the year-ago reported figure.
Despite catastrophe losses that induce volatility in profits, underwriting results are likely to benefit from rate increases, exposure growth and traditional risk management capabilities in the to-be-reported quarter. We expect the combined ratio to be 87.8 in the to-be-reported quarter.
We estimate underwriting income in the Insurance segment to increase 90.1% to $131.2 million and 2.4% to $307.1 million in the Reinsurance segment in the to-be-reported quarter.
The Zacks Consensus Estimate for EG’s fourth-quarter earnings per share is currently pegged at $14.63, indicating an increase of 19.8% from the year-ago quarter’s reported figure.
What the Zacks Model Says
Our proven model predicts an earnings beat for Everest Group this time around. This is because the stock has the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) that increases the odds of an earnings beat.
Earnings ESP: Everest Group has an Earnings ESP of +1.18%. This is because the Most Accurate Estimate of $14.80 is pegged higher than the Zacks Consensus Estimate of $14.63. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: EG carries a Zacks Rank #3 at present.
Other Stocks to Consider
Some other insurance stocks with the right combination of elements to deliver an earnings beat this time around are:
Lincoln National Corporation (LNC - Free Report) has an Earnings ESP of +11.41% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for fourth-quarter 2023 earnings is pegged at $1.32, indicating an increase of 36.08% from the year-ago reported figure. You can see the complete list of today’s Zacks #1 Rank stocks here.
LNC’s earnings beat estimates in two of the last four quarters while missing in the other two.
Arch Capital Group (ACGL - Free Report) has an Earnings ESP of +1.24% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for fourth-quarter 2023 earnings is pegged at $1.94, implying a decline of 9.3% from the year-ago reported figure.
ACGL’s earnings beat estimates in each of the last four reported quarters.
Primerica, Inc. (PRI - Free Report) has an Earnings ESP of +0.44% and a Zacks Rank of 2 at present. The Zacks Consensus Estimate for fourth-quarter 2023 earnings is pegged at $4.26, indicating an increase of 22.06% from the year-ago reported figure.
PRI’s earnings beat estimates in each of the last four reported quarters.
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Will Everest Group's (EG) Beat Streak Continue in Q4 Earnings?
Everest Group, Ltd. (EG - Free Report) is slated to report fourth-quarter 2023 earnings on Feb 7, after market close. The insurer delivered an earnings surprise in three of the last four quarters and missed in one, the average being 24.5%.
Factors to Consider
Premium growth is likely to have been driven by the solid performance of its Reinsurance segment, rate increases, exposure growth and strong underwriting. We expect net written premium to increase 8.3% to $3.4 billion in the fourth quarter.
The Insurance segment is likely to have benefited from an increase in property, short tail business, specialty casualty business and other specialty lines of business, as well as new business and strong renewal retention. We estimate premiums earned to increase 19.5% to $3.6 billion in the to-be-reported quarter.
Commission ratio is likely to have gained from the business mix, as well as increased volume of ceding commissions and decreased gross commissions across multiple lines.
The Reinsurance segment is expected to have benefited from widespread growth across business lines and geographies, including marine and aviation, as well as solid international growth, higher property cat premiums and casualty and improved property pro-rata premiums. We expect premiums earned to improve 22.3% to $2.7 billion in the fourth quarter.
Net investment income is likely to have benefited from higher new money yields, investment in floating rate securities and improved assets under management. We expect net investment income to be $407.4 million, up 94% from the year-ago reported quarter.
The top line in the to-be-reported quarter is expected to have gained from higher net written premiums and net investment income. The Zacks Consensus Estimate for revenues is currently pegged at $4.01 billion, indicating a 25.5% increase from the year-ago reported figure.
Despite catastrophe losses that induce volatility in profits, underwriting results are likely to benefit from rate increases, exposure growth and traditional risk management capabilities in the to-be-reported quarter. We expect the combined ratio to be 87.8 in the to-be-reported quarter.
We estimate underwriting income in the Insurance segment to increase 90.1% to $131.2 million and 2.4% to $307.1 million in the Reinsurance segment in the to-be-reported quarter.
The Zacks Consensus Estimate for EG’s fourth-quarter earnings per share is currently pegged at $14.63, indicating an increase of 19.8% from the year-ago quarter’s reported figure.
What the Zacks Model Says
Our proven model predicts an earnings beat for Everest Group this time around. This is because the stock has the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) that increases the odds of an earnings beat.
Earnings ESP: Everest Group has an Earnings ESP of +1.18%. This is because the Most Accurate Estimate of $14.80 is pegged higher than the Zacks Consensus Estimate of $14.63. 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: EG carries a Zacks Rank #3 at present.
Other Stocks to Consider
Some other insurance stocks with the right combination of elements to deliver an earnings beat this time around are:
Lincoln National Corporation (LNC - Free Report) has an Earnings ESP of +11.41% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for fourth-quarter 2023 earnings is pegged at $1.32, indicating an increase of 36.08% from the year-ago reported figure. You can see the complete list of today’s Zacks #1 Rank stocks here.
LNC’s earnings beat estimates in two of the last four quarters while missing in the other two.
Arch Capital Group (ACGL - Free Report) has an Earnings ESP of +1.24% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for fourth-quarter 2023 earnings is pegged at $1.94, implying a decline of 9.3% from the year-ago reported figure.
ACGL’s earnings beat estimates in each of the last four reported quarters.
Primerica, Inc. (PRI - Free Report) has an Earnings ESP of +0.44% and a Zacks Rank of 2 at present. The Zacks Consensus Estimate for fourth-quarter 2023 earnings is pegged at $4.26, indicating an increase of 22.06% from the year-ago reported figure.
PRI’s earnings beat estimates in each of the last four reported quarters.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.