ProAssurance (PRA) to Post Q4 Earnings: What's in the Cards?
ProAssurance Corporation PRA is set to report its fourth-quarter 2022 results on Feb 27, after the closing bell.
In the last reported quarter, the property and casualty insurance provider reported an adjusted operating loss per share of 6 cents against the Zacks Consensus Estimate of earnings of 20 cents, due to decreased profits from all its segments except Workers' Compensation. This was partially offset by higher investment income and lower expenses. The NORCAL acquisition keeps supporting its growth.
Let’s see how things have shaped up prior to the fourth-quarter earnings announcement.
The Trend in Estimate Revision
The Zacks Consensus Estimate for fourth-quarter earnings per share of 4 cents indicates a 93.6% decrease from the year-ago quarter’s reported earnings of 62 cents. The consensus estimate has witnessed no movement in the past week.
While the Zacks Consensus Estimate for revenues is pegged at $286.9 million, suggesting a fall of 2.4% from the year-ago quarter’s reported figure, our estimate predicts a 4.5% year-over-year decline.
ProAssurance’s earnings beat estimates in two of the trailing four quarters and missed on the other occasions, the average surprise being 101.8%. This is depicted in the graph below.
ProAssurance Corporation Price and EPS Surprise
ProAssurance Corporation price-eps-surprise | ProAssurance Corporation Quote
Factors to Note
The Zacks Consensus Estimate for net premiums earned indicates a 5.2% year-over-year decline while our estimate suggests an 8% fall. Also, the consensus mark for the combined ratio is pegged at 106% while our estimate predicts 107.6% compared with the year-ago level of 97%.
A higher combined ratio suggests that the company had a lesser amount of premium left after claim settlements. This is expected to have positioned the company for a year-over-year decline, making an earnings beat uncertain.
Further, the Zacks Consensus Estimate for Workers’ Compensation Insurance revenues indicates a 1.9% year-over-year fall. Also, both the consensus mark and our estimate for Specialty P&C Segment revenues predict an 8.3% decline from a year ago.
The negatives are expected to have been partially offset by higher investment income, thanks to the high interest rate environment. The Zacks Consensus Estimate for net investment income indicates a 29.9% year-over-year increase while our estimate suggests 30.4% growth.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for ProAssurance this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you will see below.
Earnings ESP: The company has an Earnings ESP of 0.00%. The Most Accurate Estimate is currently pegged at 4 cents per share, in line with the Zacks Consensus Estimate.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: ProAssurance currently carries a Zacks Rank #3.
Stocks to Consider
While an earnings beat looks uncertain for ProAssurance, here are some companies in the broader Finance space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time around:
Stellus Capital Investment Corporation SCM has an Earnings ESP of +6.03% and is a Zacks #2 Ranked player. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Stellus Capital’s bottom line for the to-be-reported quarter is pegged at 39 cents per share, indicating an 18.2% improvement from the year-ago figure. SCM beat earnings estimates in three of the past four quarters and missed on the other occasion, with an average surprise of 6%.
Silver Spike Investment Corp. SSIC has an Earnings ESP of +2.56% and a Zacks Rank of 2.
The Zacks Consensus Estimate for Silver Spike Investment’s bottom line for the to-be-reported quarter is pegged at 20 cents per share, which has improved 11.1% in the past 30 days. SSIC witnessed one upward estimate revision against none in the opposite direction, in the past 30 days.
Monroe Capital Corporation MRCC has an Earnings ESP of +5.00% and a Zacks Rank of 2.
The Zacks Consensus Estimate for Monroe Capital’s bottom line for the to-be-reported quarter is pegged at 27 cents per share, indicating an 8% year-over-year rise. MRCC beat earnings estimates in one of the past four quarters and met on three other occasions, with an average surprise of 4%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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ProAssurance Corporation (PRA) : Free Stock Analysis Report
Monroe Capital Corporation (MRCC) : Free Stock Analysis Report
Stellus Capital Investment Corporation (SCM) : Free Stock Analysis Report
Silver Spike Investment Corp. (SSIC) : Free Stock Analysis Report
