U.S. property and casualty insurer
The Chubb Corp.
) reported fourth-quarter 2013 operating earnings of $2.07 per
share, 4 cents ahead of the Zacks Consensus Estimate, and up 13
times year over year. Earnings benefited from low claims paid
during the quarter, growth in premium and a lower share count.
Net written premium for the reported quarter was up 4% year over
year to $3.0 billion, led by 7% premium growth in U.S., partly
offset by a 3% decline in premium from outside the U.S.
Property and casualty investment income after tax was down 4%
year over year to $284 million.
Combined ratio for the quarter improved markedly by 2570 basis
points (bps) year over year to 85.5%, led by a benign cat loss
during the quarter.
Book value per share, a measure of net worth, was $64.83, up 7.2%
year over year.
Full Year Results
For full year 2013, operating income came in at $9.04 per share,
comfortably outpacing its own guidance range of $7.90 to $8.00
per share and the Zacks Consensus Estimate of $7.98 per share.
segment, net written premium increased 4% year over year to
$1.3 billion during the reported quarter. The combined ratio
improved by 2970 bps year over year to 89.0% due to significantly
lower cat loss.
's net written premiums improved 2% year over year to $705
million due to higher premiums written in the surety lines,
followed by professional liability lines. The combined ratio
improved 660 bps year over year to 81.9%.
segment's net written premiums rose 6% year over year to $1.1
billion, primarily driven by higher premium in the Personal lines
business followed by Homeowners and Personal Auto. Due to low
catastrophe-related loss the combined ratio improved by 34400 bps
year over year to 83.5%.
During the quarter, Chubb repurchased 3.5 million shares of its
common stock at a total cost of $325 million.
For 2014, Chubb expects to produce $7.10 to $7.40 in earnings per
share, along with 2% to 4% premium growth, combined ratio in the
range of 89% to 90% and a 4% to 6% decline in net investment
income. The company expects that cat losses will have 5% adverse
impact on 2014 combined ratio, which is 1% higher than the 2013
Chubb carries a Zacks Rank #2 (Buy).
Chubb has been posting favorable earnings results for the past
several quarters. The company is benefiting from hardening
insurance rates coupled with lower losses, owing to the benign
cat season this year. We expect the company to maintain its
earnings streak going forward as insurance pricing continues to
improve and interest rates moves up.
Other well-placed property and casualty players worth considering
Aspen Insurance Holdings Ltd.
Endurance Specialty Holdings Ltd.
Navigators Group Inc.
). All these companies with a Zacks Rank #1 (Strong Buy) are due
to release their fourth-quarter and full year earnings in early
ASPEN INS HLDGS (AHL): Free Stock Analysis
CHUBB CORP (CB): Free Stock Analysis Report
ENDURANCE SPLTY (ENH): Free Stock Analysis
NAVIGATORS GRP (NAVG): Free Stock Analysis
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