A month has gone by since the last earnings report for Everest Re . Shares have added about 0.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Everest Re due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Everest Re Q1 Earnings Beat Estimates, Revenues Miss
Everest Re Group, Ltd. delivered first-quarter 2019 operating net income per share of $6.91, beating the Zacks Consensus Estimate by 9.7%. The bottom line improved 29.4% year over year.
Both its reinsurance and insurance businesses witnessed growth in the quarter.
Operational Update
Everest Re’s total operating revenues of $1.9 billion increased 5.4% year over year. However, the top line missed the Zacks Consensus Estimate by 4.8%.
Gross written premiums improved 10% year over year to $2.1 billion. The company’s worldwide reinsurance premiums rose 7% to $1.5 billion on the back of increased casualty and property pro-rata premium, increased shares on existing business and profitable new growth. Direct insurance premiums grew 18%.
Net investment income came in at $141 million in the quarter under review, up 1.9% year over year.
Total claims and expenses increased 1.6% to $1.6 billion, attributable to higher commission, brokerage, taxes and fees, other underwriting expenses and interest, fees and bond issue cost amortization expense.
Combined ratio improved 460 basis points (bps) to 88.7%. Excluding catastrophe loss, attritional combined ratio was 87.4%, a deterioration of 30 bps from the prior-year period.
Financial Update
Everest Re Group exited the quarter with total investments and cash of $19.2 billion, up 4.3% from 2018 end level. Shareholder equity at the end of the reported quarter increased 6.6% from 2018 end to $8.4 billion.
Book value per share came in at $206.68 as of Mar 31, 2019, up 6.3% from the 2018-end level.
Everest Re Group’s cash flow from operations was $459.8 million, up 135% year over year.
The company bought back shares worth $162 million in the quarter. The company still has 1.4 million shares remaining under its authorization.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
At this time, Everest Re has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile 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 upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Everest Re has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Image: Bigstock
Why Is Everest Re (RE) Up 0.6% Since Last Earnings Report?
A month has gone by since the last earnings report for Everest Re . Shares have added about 0.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Everest Re due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Everest Re Q1 Earnings Beat Estimates, Revenues Miss
Everest Re Group, Ltd. delivered first-quarter 2019 operating net income per share of $6.91, beating the Zacks Consensus Estimate by 9.7%. The bottom line improved 29.4% year over year.
Both its reinsurance and insurance businesses witnessed growth in the quarter.
Operational Update
Everest Re’s total operating revenues of $1.9 billion increased 5.4% year over year. However, the top line missed the Zacks Consensus Estimate by 4.8%.
Gross written premiums improved 10% year over year to $2.1 billion. The company’s worldwide reinsurance premiums rose 7% to $1.5 billion on the back of increased casualty and property pro-rata premium, increased shares on existing business and profitable new growth. Direct insurance premiums grew 18%.
Net investment income came in at $141 million in the quarter under review, up 1.9% year over year.
Total claims and expenses increased 1.6% to $1.6 billion, attributable to higher commission, brokerage, taxes and fees, other underwriting expenses and interest, fees and bond issue cost amortization expense.
Combined ratio improved 460 basis points (bps) to 88.7%. Excluding catastrophe loss, attritional combined ratio was 87.4%, a deterioration of 30 bps from the prior-year period.
Financial Update
Everest Re Group exited the quarter with total investments and cash of $19.2 billion, up 4.3% from 2018 end level. Shareholder equity at the end of the reported quarter increased 6.6% from 2018 end to $8.4 billion.
Book value per share came in at $206.68 as of Mar 31, 2019, up 6.3% from the 2018-end level.
Everest Re Group’s cash flow from operations was $459.8 million, up 135% year over year.
The company bought back shares worth $162 million in the quarter. The company still has 1.4 million shares remaining under its authorization.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
At this time, Everest Re has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile 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 upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Everest Re has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.