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Donegal Q3 profit falls 9.6% on lower premiums

By Reuters News


Overview

  • US property and casualty insurer's Q3 net premiums earned fell 3% yr/yr

  • Q3 net income declined nearly 10% yr/yr

  • Company cites soft market conditions and pricing discipline for premium declines


Outlook

  • Company aims for modest premium growth in 2027 due to soft market conditions


Result Drivers

  • SOFT MARKET CONDITIONS - Co said ongoing soft market conditions impeded premium growth

  • PRICING DISCIPLINE - Co said premium declines were mainly due to higher attrition from pricing discipline on renewals amid increased rate competition

  • WEATHER AND CLAIMS - Co said underwriting results were affected by increased weather-related losses and several severe workers’ compensation claims


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Revenue

Slight Beat*

$237.66 mln

$236.81 mln (2 Analysts)

Q3 Net Income

$18.16 mln

Q3 Combined Ratio

96.50%

Q3 Expense Ratio

34.80%

*Applies to a deviation of less than 1%; not applicable for per-share numbers.


Analyst Coverage

  • The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 1 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

  • The average consensus recommendation for the property & casualty insurance peer group is "hold"

  • Wall Street's median 12-month price target for Donegal Group Inc is $20.00, about 7.4% above its October 28 closing price of $18.63

  • The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 10 three months ago


Reuters Recommended Reads

  • Oct 28 - Employers Holdings Q3 net premiums earned falls

  • Oct 28 - Amerisafe Q3 operating EPS falls on higher expenses, competitive workers' compensation market

  • Oct 28 - Everest Group Q3 profit falls on reserve strengthening, catastrophe losses


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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