Donegal Q3 profit falls 9.6% on lower premiums

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

*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

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(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.)