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Why Is Selective Insurance (SIGI) Up 4.2% Since Last Earnings Report?
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A month has gone by since the last earnings report for Selective Insurance (SIGI - Free Report) . Shares have added about 4.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Selective Insurance due for a pullback? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for Selective Insurance Group, Inc. before we dive into how investors and analysts have reacted as of late.
Selective Insurance Q2 Earnings Miss Estimates, Revenues Top
Selective Insurance reported second-quarter 2025 operating income of $1.31 per share, which missed the Zacks Consensus Estimate by 15.5%. The bottom line rebounded from the year-ago loss of $1.10 per share.
The company’s performance in the quarter reflects solid underwriting income, lower catastrophe losses, average renewal pure price increase and lower loss and loss expenses.
Behind the Headlines
Total revenues of $1.3 billion increased 10.9% from the year-ago quarter’s figure, primarily due to higher net premiums written, net premiums earned and net investment income earned. The top line beat the Zacks Consensus Estimate by 0.9%.
On a year-over-year basis, net premiums written (NPW) increased 5% to $1.3 billion. Average renewal pure price expanded 80 basis points year over year to 9.9%. The figure matched our estimate.
Net investment income increased 18% year over year to $101 million.
Net catastrophe losses of $79.9 million were narrower than the year-ago loss of $90.5 million. Non-catastrophe property loss and loss expenses were $173.2 million, narrower than the year-ago loss of $185.5 million.
The combined ratio of 96.1 improved 1590 basis points year over year, driven by lower unfavorable prior year casualty reserve development, net catastrophe losses, and non-catastrophe property losses. The Zacks Consensus Estimate was 98. Our estimate was 99.1.
Total expenses declined 4.6% year over year to $1.2 billion, primarily due to lower loss and loss expense incurred. The figure matched our estimate.
Segmental Results
Standard Commercial Lines’ NPW was up 6% year over year to $1 billion. The premium growth reflected average renewal pure price increases of 8.9% and lower retention of 83%. Our estimate was $997.4 million.
The combined ratio improved 1600 basis points (bps) to 102.8. The Zacks Consensus Estimate was 99 and our estimate was 100.8.
Standard Personal Lines’ NPW decreased 5% year over year to $110.5 million due to deliberate profit improvement actions. New business decreased 41%, while renewal pure price was 19% and retention was 79%. The figure was lower than our estimate of $136.2 million.
The combined ratio improved 2650 bps on a year-over-year basis to 91.6. The Zacks Consensus Estimate was pegged at 110, while our estimate was 117.3.
Excess & Surplus Lines’ NPW was up 9% year over year to $160.2 million, driven by average renewal pure price increases of 9.3%. Our estimate was $190.2 million.
The combined ratio improved 480 bps to 89.8. The Zacks Consensus Estimate was pegged at 86, while our estimate was 77.7.
Financial Update
Selective Insurance exited the second quarter of 2025 with total assets of $14.5 billion, 7% above the level at December 2024 end.
Long-term debt of $902.7 million surged 78% from the 2024 end level. Debt-to-total capitalization deteriorated 710 bps to 21.1% from the 2024 end level.
As of June 30, 2025, adjusted book value per share was $54.48, up 5% year over year.
Operating return on common equity was 10.3% versus negative 9.6% in the year-ago quarter.
Share Repurchase and Dividend Update
Selective Insurance did not repurchase any shares but had $56.1 million remaining under authorization as of June 30, 2025.
The board of directors authorized a quarterly cash dividend of 38 cents per share. The dividend will be paid out on Sept. 2 to shareholders of record at the close of business on Aug. 15, 2025.
2025 Guidance
SIGI estimates a GAAP combined ratio of 97% to 98%, a 100-basis point deterioration from the level guided earlier. It also includes net catastrophe losses of 6 points.
Selective Insurance estimates an after-tax net investment income of $415 million, up from the prior guidance of $405 million.
The overall effective tax rate is expected to be around 21.5%. Weighted average shares were 61.5 million on a fully diluted basis.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
VGM Scores
Currently, Selective Insurance has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Selective Insurance has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Selective Insurance is part of the Zacks Insurance - Property and Casualty industry. Over the past month, Progressive (PGR - Free Report) , a stock from the same industry, has gained 0.6%. The company reported its results for the quarter ended June 2025 more than a month ago.
Progressive reported revenues of $21.62 billion in the last reported quarter, representing a year-over-year change of +18.4%. EPS of $4.88 for the same period compares with $2.65 a year ago.
For the current quarter, Progressive is expected to post earnings of $3.92 per share, indicating a change of +9.5% from the year-ago quarter. The Zacks Consensus Estimate has changed +4.2% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Progressive. Also, the stock has a VGM Score of A.
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Why Is Selective Insurance (SIGI) Up 4.2% Since Last Earnings Report?
A month has gone by since the last earnings report for Selective Insurance (SIGI - Free Report) . Shares have added about 4.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Selective Insurance due for a pullback? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for Selective Insurance Group, Inc. before we dive into how investors and analysts have reacted as of late.
Selective Insurance Q2 Earnings Miss Estimates, Revenues Top
Selective Insurance reported second-quarter 2025 operating income of $1.31 per share, which missed the Zacks Consensus Estimate by 15.5%. The bottom line rebounded from the year-ago loss of $1.10 per share.
The company’s performance in the quarter reflects solid underwriting income, lower catastrophe losses, average renewal pure price increase and lower loss and loss expenses.
Behind the Headlines
Total revenues of $1.3 billion increased 10.9% from the year-ago quarter’s figure, primarily due to higher net premiums written, net premiums earned and net investment income earned. The top line beat the Zacks Consensus Estimate by 0.9%.
On a year-over-year basis, net premiums written (NPW) increased 5% to $1.3 billion. Average renewal pure price expanded 80 basis points year over year to 9.9%. The figure matched our estimate.
Net investment income increased 18% year over year to $101 million.
Net catastrophe losses of $79.9 million were narrower than the year-ago loss of $90.5 million. Non-catastrophe property loss and loss expenses were $173.2 million, narrower than the year-ago loss of $185.5 million.
The combined ratio of 96.1 improved 1590 basis points year over year, driven by lower unfavorable prior year casualty reserve development, net catastrophe losses, and non-catastrophe property losses. The Zacks Consensus Estimate was 98. Our estimate was 99.1.
Total expenses declined 4.6% year over year to $1.2 billion, primarily due to lower loss and loss expense incurred. The figure matched our estimate.
Segmental Results
Standard Commercial Lines’ NPW was up 6% year over year to $1 billion. The premium growth reflected average renewal pure price increases of 8.9% and lower retention of 83%. Our estimate was $997.4 million.
The combined ratio improved 1600 basis points (bps) to 102.8. The Zacks Consensus Estimate was 99 and our estimate was 100.8.
Standard Personal Lines’ NPW decreased 5% year over year to $110.5 million due to deliberate profit improvement actions. New business decreased 41%, while renewal pure price was 19% and retention was 79%. The figure was lower than our estimate of $136.2 million.
The combined ratio improved 2650 bps on a year-over-year basis to 91.6. The Zacks Consensus Estimate was pegged at 110, while our estimate was 117.3.
Excess & Surplus Lines’ NPW was up 9% year over year to $160.2 million, driven by average renewal pure price increases of 9.3%. Our estimate was $190.2 million.
The combined ratio improved 480 bps to 89.8. The Zacks Consensus Estimate was pegged at 86, while our estimate was 77.7.
Financial Update
Selective Insurance exited the second quarter of 2025 with total assets of $14.5 billion, 7% above the level at December 2024 end.
Long-term debt of $902.7 million surged 78% from the 2024 end level. Debt-to-total capitalization deteriorated 710 bps to 21.1% from the 2024 end level.
As of June 30, 2025, adjusted book value per share was $54.48, up 5% year over year.
Operating return on common equity was 10.3% versus negative 9.6% in the year-ago quarter.
Share Repurchase and Dividend Update
Selective Insurance did not repurchase any shares but had $56.1 million remaining under authorization as of June 30, 2025.
The board of directors authorized a quarterly cash dividend of 38 cents per share. The dividend will be paid out on Sept. 2 to shareholders of record at the close of business on Aug. 15, 2025.
2025 Guidance
SIGI estimates a GAAP combined ratio of 97% to 98%, a 100-basis point deterioration from the level guided earlier. It also includes net catastrophe losses of 6 points.
Selective Insurance estimates an after-tax net investment income of $415 million, up from the prior guidance of $405 million.
The overall effective tax rate is expected to be around 21.5%. Weighted average shares were 61.5 million on a fully diluted basis.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
VGM Scores
Currently, Selective Insurance has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Selective Insurance has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Selective Insurance is part of the Zacks Insurance - Property and Casualty industry. Over the past month, Progressive (PGR - Free Report) , a stock from the same industry, has gained 0.6%. The company reported its results for the quarter ended June 2025 more than a month ago.
Progressive reported revenues of $21.62 billion in the last reported quarter, representing a year-over-year change of +18.4%. EPS of $4.88 for the same period compares with $2.65 a year ago.
For the current quarter, Progressive is expected to post earnings of $3.92 per share, indicating a change of +9.5% from the year-ago quarter. The Zacks Consensus Estimate has changed +4.2% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Progressive. Also, the stock has a VGM Score of A.