Universal Insurance Q3 profit rises on improved underwriting, investment income

By Reuters News


Overview

  • US property insurer's Q3 revenue rose 9.6% year-over-year

  • Net income rises, while adjusted EPS rose 41.9%, driven by improved underwriting and investment income

  • Company repurchased $7.4 mln in shares during the quarter


Outlook

  • Company says new business trends are solid with 8% growth in policies in force

  • Company says claims activity from Hurricane Isaias has been less significant than anticipated


Result Drivers

  • UNDERWRITING AND INVESTMENT INCOME - Co said higher adjusted net income was mainly due to improved underwriting and increased net investment income

  • PREMIUMS AND INVESTMENT YIELDS - Co said core revenue growth was driven by higher net premiums earned and increased net investment income

  • REINSURANCE PROGRAM - Lower ceded premium ratio due to new reinsurance program contributed to higher net premiums earned


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Revenue

Beat

$439.32 mln

$386.13 mln (1 Analyst)

Q3 Core Revenue

$444.31 mln

Q3 Adjusted Net Income

$56.27 mln

Q3 Net Income

$52.51 mln


Analyst Coverage

  • The current average analyst rating on the shares is "hold" and the breakdown of recommendations is no "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 Universal Insurance Holdings Inc is $31.90, about 33.2% below its October 21 closing price of $47.73

  • The stock recently traded at 9 times the next 12-month earnings vs. a P/E of 9 three months ago


Reuters Recommended Reads

  • Oct 20 - Insurance firm Chubb Q3 net income rises

  • Oct 19 - RLI Q3 revenue beats estimates on underwriting performance

  • Oct 22 - Insurer Old Republic's Q3 net premiums rise, helped by acquisition


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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