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Navigators Group (NAVG) Misses on Q4 Earnings & Revenues
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The Navigators Group, Inc. reported fourth-quarter 2016 net operating earnings per share of 58 cents, which missed the Zacks Consensus Estimate of 62 cents by 6.5%. Shares of the company dipped 2.1% in the last trading session, reflecting the underperformance. Nonetheless, earnings improved 5.5% year over year.
The company recorded its 16th consecutive quarter of profitable underwriting results, with solid performance by its investment portfolio. The company also witnessed strong premium growth in the reported quarter. U.S. Insurance and Global Reinsurance segments delivered solid performance. The International Insurance segment, however, was adversely impacted by property loss activity.
Navigators Group’s operating revenues rose 11.7% year over year to $306 million in the reported quarter. Revenues missed the Zacks Consensus Estimate by 1.1%. Net earned premiums climbed 12.9% to $284 million buoyed by growth in both the U.S. insurance and International insurance. The net investment income increased 8.7% to $20 million.
Total expense rose 12.2% to $278.6 million, primarily due to high net losses and loss adjustment expenses as well as commissions and interest expenses.
Underwriting profit increased 31% to $9.3 million. Surge in underwriting profit at both the U.S. Insurance and Global Re segments fueled the upside. Combined ratio improved 50 basis points (bps) to 96.7% from the year-ago quarter.
2016 Highlights
Navigators Group reported operating profit of $2.37 per share buoyed by revenues of $1.2 billion.
While the bottom line deteriorated 8.8%, top line improved 13.1%.
The Navigators Group, Inc. Price, Consensus and EPS Surprise
U.S. Insurance: Net earned premiums grew about 15.1% year over year to $166.7 million. The segment reported underwriting profit of $8.7 million compared with $1.1 million earned in the year-ago quarter. Combined ratio improved 450 bps to 94.8% in the reported quarter.
International Insurance: Net earned premiums climbed 14.5% year over year to $73.7 million. The segment’s underwriting loss of $8.5 million was significantly wider than the year-ago loss of $0.5 million. However, combined ratio deteriorated 1110 bps to 111.9% in the quarter.
Global Re: The segment’s net earned premiums declined 16.9% year over year to $36.4 million. Underwriting profit increased 38% year over year to $9.1 million in the reported quarter. Combined ratio improved 510 bps to 85% in the quarter.
Financial Update
Navigators Group exited 2016 with book value per share of $40.45, up 6.5% from $37.98 as of Dec 31, 2015.
As of Sep 30, 2016, Navigators Group’s total investment and cash amounted to $3.2 billion, up 6.7% from $3 billion at year-end 2015. Total shareholders’ equity was $1.2 billion as of Dec 31, 2016, up 9.9% from $1.1 billion at the end of 2015.
Dividend Update
On Feb 16, 2017, the board of directors declared a quarterly cash dividend of 4.50 cents per share. The dividend will be paid on Mar 24, to shareholders on record at the close of business on Mar 3, 2017.
Zacks Rank
Currently, Navigators Group carries a Zacks Rank #5 (Strong Sell).
Bottom line at Progressive Corp. (PGR - Free Report) and The Travelers Companies Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) beat their respective Zacks Consensus Estimate in the fourth quarter.
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Navigators Group (NAVG) Misses on Q4 Earnings & Revenues
The Navigators Group, Inc. reported fourth-quarter 2016 net operating earnings per share of 58 cents, which missed the Zacks Consensus Estimate of 62 cents by 6.5%. Shares of the company dipped 2.1% in the last trading session, reflecting the underperformance. Nonetheless, earnings improved 5.5% year over year.
The company recorded its 16th consecutive quarter of profitable underwriting results, with solid performance by its investment portfolio. The company also witnessed strong premium growth in the reported quarter. U.S. Insurance and Global Reinsurance segments delivered solid performance. The International Insurance segment, however, was adversely impacted by property loss activity.
Navigators Group’s operating revenues rose 11.7% year over year to $306 million in the reported quarter. Revenues missed the Zacks Consensus Estimate by 1.1%. Net earned premiums climbed 12.9% to $284 million buoyed by growth in both the U.S. insurance and International insurance. The net investment income increased 8.7% to $20 million.
Total expense rose 12.2% to $278.6 million, primarily due to high net losses and loss adjustment expenses as well as commissions and interest expenses.
Underwriting profit increased 31% to $9.3 million. Surge in underwriting profit at both the U.S. Insurance and Global Re segments fueled the upside. Combined ratio improved 50 basis points (bps) to 96.7% from the year-ago quarter.
2016 Highlights
Navigators Group reported operating profit of $2.37 per share buoyed by revenues of $1.2 billion.
While the bottom line deteriorated 8.8%, top line improved 13.1%.
The Navigators Group, Inc. Price, Consensus and EPS Surprise
The Navigators Group, Inc. Price, Consensus and EPS Surprise | The Navigators Group, Inc. Quote
Segment Update
U.S. Insurance: Net earned premiums grew about 15.1% year over year to $166.7 million. The segment reported underwriting profit of $8.7 million compared with $1.1 million earned in the year-ago quarter. Combined ratio improved 450 bps to 94.8% in the reported quarter.
International Insurance: Net earned premiums climbed 14.5% year over year to $73.7 million. The segment’s underwriting loss of $8.5 million was significantly wider than the year-ago loss of $0.5 million. However, combined ratio deteriorated 1110 bps to 111.9% in the quarter.
Global Re: The segment’s net earned premiums declined 16.9% year over year to $36.4 million. Underwriting profit increased 38% year over year to $9.1 million in the reported quarter. Combined ratio improved 510 bps to 85% in the quarter.
Financial Update
Navigators Group exited 2016 with book value per share of $40.45, up 6.5% from $37.98 as of Dec 31, 2015.
As of Sep 30, 2016, Navigators Group’s total investment and cash amounted to $3.2 billion, up 6.7% from $3 billion at year-end 2015. Total shareholders’ equity was $1.2 billion as of Dec 31, 2016, up 9.9% from $1.1 billion at the end of 2015.
Dividend Update
On Feb 16, 2017, the board of directors declared a quarterly cash dividend of 4.50 cents per share. The dividend will be paid on Mar 24, to shareholders on record at the close of business on Mar 3, 2017.
Zacks Rank
Currently, Navigators Group carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other P&C Insurers
Bottom line at Progressive Corp. (PGR - Free Report) and The Travelers Companies Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) beat their respective Zacks Consensus Estimate in the fourth quarter.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>