RenaissanceRe Holdings Ltd.
) reported first-quarter 2013 operating earnings per share of
$3.92, surpassing the Zacks Consensus Estimate of $2.92. The
results also surpassed $2.98 per share earned in the year-ago
Operating earnings for the quarter came in at $176.6 million
compared with $155.5 million in the year-ago quarter.
Including net realized and unrealized gains on investments of
$13.9 million or 31 cents per share in the reported quarter, net
income was $190.5 million or $4.23 per share compared with $201.4
million or $3.88 per share in the prior-year quarter. The
year-ago quarter included net realized and unrealized gains on
investments of $46.1 million or 90 cents per share and net
other-than-temporary impairments from continuing operations of
RenaissanceRe posted total revenue of $343.3 million, down
3.7% year over year from $356.5 million in the first quarter of
2012. Total revenue surpassed the Zacks Consensus Estimate of
In addition, gross premiums declined 4.3% year over year to
$635.4 million. Meanwhile, underwriting income declined to $173.0
million from $196.6 million in the year-ago quarter. In the
reported quarter, combined ratio also deteriorated to 36.2% from
29.4% in the first quarter of 2012.
RenaissanceRe reported total investment income (sum of net
investment income, net realized and unrealized gains on
investments and net other-than-temporary impairments) of $51.4
million in the quarter under review, against $113.7 million in
the year-ago quarter. The decline was primarily attributable to
lower returns in the fixed maturity investment portfolio as well
as the portfolio of other investments.
Moreover, total expenses of RenaissanceRe surged 16.5% to
$107.8 million from $92.6 million in the prior-year quarter.
segment reported gross premiums written of $561.1 million, down
8% from the prior-year quarter. Underwriting income came in at
$168.3 million compared with $194.1 million in the first quarter
of 2012, while combined ratio deteriorated to 27.9% from 23.5%,
primarily due to higher net claims and claims expenses, lower net
premiums earned, higher ceded premiums written and the external
cession of business in Upsilon Reinsurance II Ltd.
segment's gross premium written came in at $74.3 million,
expanding 35.5% from the year-ago quarter due to organic growth.
Underwriting income widened to $4.2 million from $1.1 million in
the year-ago quarter. Combined ratio improved to 89.0% from 95.6%
in the prior-year quarter.
RenaissanceRe exited the reported quarter with total assets of
$8.1 billion, up from $7.9 billion as of Dec 31, 2012. Long-term
debt totaled $254.3 million, down from $351.8 million at the end
Meanwhile, cash and cash equivalents stood at $335.6 million,
up from $325.4 million as of Dec 31, 2012. Shareholder equity
totaled $3.56 billion compared with $3.50 billion at the end of
As of Mar 31, 2013, RenaissanceRe's annualized return on
average common equity (ROCE) was 24.3%, declining from 25.6% in
the first quarter of 2012.
During the reported quarter, RenaissanceRe repurchased 1.4
million equity shares at an average price of $81.29, totaling
In Jan 2013, RenaissanceRe redeemed some shares of DaVinciRe,
while some additional shares were issued. The net effect of these
transactions was redemption of shares worth $150 million. As of
Mar 31, 2013, RenaissanceRe holds 32.9% stake in DaVinciRe.
In Feb 2013, RenaissanceRe repaid $100 million worth of 5.875%
senior notes that matured. The company used its available cash
and investments for the repayment.
Currently, RenaissanceRe carries a Zacks Rank #2 (Buy). Other
property & casualty insurers worth considering are
Navigators Group Inc.
Hilltop Holdings Inc.
Montpelier Re Holdings Ltd.
). All these companies carry a Zacks Rank #1 (Strong Buy).
HILLTOP HLDGS (HTH): Free Stock Analysis
MONTPELIER RE (MRH): Free Stock Analysis
NAVIGATORS GRP (NAVG): Free Stock Analysis
RENAISSANCERE (RNR): Free Stock Analysis
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