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Everest Re (RE) Q3 Earnings Top Estimates, Revenues Up Y/Y

Zacks Equity Research

Everest Re Group, Ltd. RE delivered third-quarter 2019 operating net income per share of $3.39, beating the Zacks Consensus Estimate by 63.8%. The bottom line declined 17.2% year over year.

Both its reinsurance and insurance businesses witnessed growth in the quarter.

Operational Update

Everest Re’s total operating revenues of $2.1 billion increased 9% year over year. However, the top line missed the Zacks Consensus Estimate by 0.8%.

Gross written premiums improved 9% year over year to $2.4 billion. The company’s worldwide reinsurance premiums increased 3% year over year to $1.7 billion. Direct insurance premiums grew 29% to $666.6 million.

Net investment income came in at $181.1 million in the quarter under review, up 12% year over year.

Total claims and expenses increased 11.6% to $1.9 billion, attributable to higher incurred losses and loss adjustment expenses, commission, brokerage, taxes and fees, other underwriting expenses and corporate expenses.

Combined ratio deteriorated 140 basis points to 101.4%.

Everest Re Group, Ltd. Price, Consensus and EPS Surprise

Everest Re Group, Ltd. Price, Consensus and EPS Surprise

Everest Re Group, Ltd. price-consensus-eps-surprise-chart | Everest Re Group, Ltd. Quote

Financial Update

Everest Re Group exited the quarter with total investments and cash of $20.4 billion, up 10.5% from 2018 level. Shareholder equity at the end of the reported quarter increased 14.3% from 2018 end to nearly $9 billion.

Book value per share came in at $193.37 as of Sep 30, 2019, down 12.2% from 2018-end level.

Annualized net income return on equity was 13% in the first nine months of 2019.

Everest Re Group’s cash flow from operations was $1.5 billion in the first nine months of 2019, up more than threefold year over year.

The company bought back shares worth $24.6 million in the first nine months of 2019. The company still has 1.3 million shares remaining under its authorization.

Zacks Rank

Everest Re Group currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other P&C Insurers

Of the insurance industry players that have reported third-quarter results so far, The Progressive Corporation PGR and RLI Corp. RLI beat the respective Zacks Consensus Estimate for earnings. However, The Travelers Companies TRV missed the same.

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