Amerisafe Inc. (AMSF - Free Report) reported second-quarter 2017 operating earnings per share of 81 cents which surpassed the Zacks Consensus Estimate by 12.5%. However, earning declined 7% year over year due to a 3.4% fall in operating income.
Quarter in Detail
Amerisafe’s total operating revenue decreased 7.8% year over year to $90 million. The top line also missed the Zacks Consensus Estimate by 5.3%
Gross premiums written in the quarter decreased 15.7%, primarily due to lower voluntary premiums written and lower payroll audits.
Net investment income increased 20.5% to $7.5 million in the quarter, largely due to a significant decline in value of an investment in a limited partnership hedge fund in last-year quarter.
Total expenses came in at $67.8 million, down 7% year over year. For the second quarter, the underwriting expense ratio was 24.4%, improving 50 basis points (bps) from the prior-year quarter. The improvement came on the back of lower loss-based assessments and lower commissions year over year.
AMERISAFE, Inc. Price, Consensus and EPS Surprise
Amerisafe exited the quarter with cash and cash equivalents of $54 million, down 8.5% from year-end 2016.
As of Jun 30, 2017, total shareholders’ equity was $481 million, up 5.5% from the end of 2016.
Operating return on equity was 13.3%, down 30 bps year over year.
Book value per share as of Jun 30, 2017 was $25.02, down 3.1% year over year.
Dividend and Share Repurchase Update
The company paid a regular quarterly cash dividend of 20 cents per share on Jun 23, 2017.
During the quarter, no shares were repurchased under the company’s share repurchase plan.
Amerisafe currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
Performance of Other Insurers
Among other players in the same space that have reported their second-quarter earnings so far, the bottom lines of The Progressive Corporation (PGR - Free Report) and The Travelers Companies, Inc. (TRV - Free Report) missed their respective Zacks Consensus Estimate while RLI Corp. (RLI - Free Report) beat the same.
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