Chubb Limited CB is slated to report third-quarter 2024 earnings on Oct. 29, after market close. CB's earnings beat estimates in each of the trailing four quarters.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Factors to Consider
Premiums in the third quarter are likely to have benefited from growth across product lines, strong premium retention, including rate and exposure increases, and solid new business.
The acquisition of Cigna's Asia business, coupled with the strong performance of distribution channels in different countries, is likely to have aided life insurance premiums.
The high net-worth personal lines business is likely to have benefited from premium growth, stemming from growth in new business.
Premiums at International Life Insurance benefited from solid performing tied agency, brokerage, bankassurance and direct marketing distribution channels.
The Zacks Consensus Estimate for net premiums earned is pegged at $13.5 billion, indicating an increase of 6.9% from the year-ago reported figure. We expect net premiums earned to be $13.3 billion.
Growing cash flow is likely to have aided net investment income. In the third quarter, Chubb anticipates adjusted net investment income between $1.57 billion and $1.63 billion. We expect net investment income to increase 13.7% to $1.5 billion.
The Zacks Consensus Estimate for revenues is pegged at $15.2 billion, indicating a rise of 8.2% from the year-ago reported figure.
The Zacks Consensus Estimate for combined ratio is pegged at 90, indicating a deterioration of 200 basis points from the year-ago reported figure. We estimate underwriting income to be $1.3 billion and the combined ratio to be 84.1.
Expenses are expected to have increased because of higher losses and loss expenses, policy benefits, policy acquisition costs, administrative expenses, interest expense, amortization of purchased intangibles and Cigna integration expenses. We estimate the metric to be $12 billion.
However, share buybacks in the to-be-reported quarter are anticipated to have provided a boost to the bottom line.
The Zacks Consensus Estimate for third-quarter earnings per share is pegged at $4.92, indicating a decrease of 0.6% from the year-ago quarter reported figure.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for CB this time around. This is because the stock has the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) that increases the odds of an earnings beat.
Earnings ESP: CB Group has an Earnings ESP of +1.75%. This is because the Most Accurate Estimate of $5.01 is pegged higher than the Zacks Consensus Estimate of $4.92. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Chubb Limited Price and EPS Surprise
Chubb Limited price-eps-surprise | Chubb Limited Quote
Zacks Rank: CB Group currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks to Consider
Here are three P&C insurance stocks you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat:
Arch Capital Group ACGL has an Earnings ESP of +7.91% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for third-quarter 2024 earnings is pegged at $1.98, indicating a year-over-year decrease of 14.3%. You can see the complete list of today’s Zacks #1 Rank stocks here.
ACGL’s earnings beat estimates in each of the last four reported quarters.
American Financial Group AFG has an Earnings ESP of +1.91% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for third-quarter 2024 earnings is pegged at $2.51, indicating a year-over-year increase of 2.5%.
AFG’s earnings beat estimates in two of the last four reported quarters while missing in the other two.
Axis Capital Holding AXS has an Earnings ESP of +2.87% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for third-quarter 2024 earnings is pegged at $2.50, indicating a year-over-year increase of 6.8%.
AXS’ earnings beat estimates in each of the last four reported quarters.
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