Chubb Posts Strong 1Q Earnings - Analyst Blog


The Chubb Corporation ( CB ) reported a record high first-quarter operating earnings of $566 million or $2.14 per share, significantly ahead of the Zacks Consensus Estimate of $1.74 per share. Earnings also increased 26% year over year from $469 million or $1.70 per share in the first quarter of 2012.

Including after-tax realized investment gains of $138 million or 34 cents per share, net income amounted to $656 million or $2.48 per share, up 36% from $506 million or $1.83 per share in the year-ago quarter.

Net written premium for the quarter was up 4% year over year to $3.1 billion.  

Property and casualty investment income after tax slumped 6% year over year to $288 million.

Combined ratio for the quarter was 84.6% compared with 90.2% last year. Excluding catastrophe losses, combined ratio was 84%, improving from 89.4% last year.

Book value per share, a measure of net worth, was $61.79 compared with $60.45 at Dec 31, 2012.

Segment Update

At Chubb Commercial Insurance segment, net written premium increased 2% year over year to $1.4 billion during the reported quarter. The combined ratio was 81.9% in the reported quarter, compared to 93.3% in the year-ago quarter.

Chubb Specialty Insurance 's net written premiums went up 5% year over year to $632 million due to higher premiums written in the professional liability lines. The combined ratio was 87.4% in the reported quarter, compared with 93.6% in the year-ago quarter.

Chubb Personal Insurance segment's net written premiums was up by 5% year over year to $987 million. The increase was driven by higher premium from Homeowners, Personal Automobile as well as Other Personal lines. Combined ratio was 87% in the reported quarter, compared to 85.5% in the year-ago quarter.

Capital Management

During the quarter Chubb repurchased 3.9 million shares of its common stock at a total cost of $326 million. The company had remaining authorization worth $1.1 billion as of Mar 31, 2013.

Zacks Rank

Chubb carries a Zacks Rank #2 (Buy). Other property and casualty insurers worth considering are Aspen Insurance Holdings Ltd. ( AHL ), Everest Re Group Ltd. ( RE ) and Global Indemnity plc ( GBLI ). All these companies carry a Zacks Rank #1 (Strong Buy).

ASPEN INS HLDGS (AHL): Free Stock Analysis Report

CHUBB CORP (CB): Free Stock Analysis Report

GLOBAL INDEMNTY (GBLI): Free Stock Analysis Report

EVEREST RE LTD (RE): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Earnings , Stocks

Referenced Stocks: AHL , CB , GBLI , RE

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