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Greenlight Capital (GLRE) Incurs Wider-Than-Expected Q4 Loss

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Greenlight Capital Re, LtdGLRE incurred fourth-quarter 2017 loss of $1.02 per share, wider than the Zacks Consensus Estimate of a loss of 55 cents. Also, the bottom line compared unfavorably with $1.31 per share earned in the year-ago period.

Greenlight Reinsurance, Ltd. Price, Consensus and EPS Surprise

Greenlight Reinsurance, Ltd. Price, Consensus and EPS Surprise | Greenlight Reinsurance, Ltd. Quote

Reserve strengthening, investment loss and losses from the California wildfires weighed on fourth-quarter results.

Shares of the company lost about 6% in the last two trading sessions reflecting its underperformance.

Quarter in Detail

Operating revenues of $125 million missed the Zacks Consensus Estimate by 20.93%. Moreover, the top line declined 33.7% year over year.

Gross written premiums of $139 million decreased 6.6% year over year. Net earned premiums increased 3.3% year over year to $141.1 million.

Net investment loss was $16.2 million, comparing unfavorably with income of $52.9 million in the year-ago quarter.

Underwriting loss of $19.7 million compared unfavorably with underwriting income of $1.4 million in the prior-year quarter, attributable to $4.7 million loss, net of reinstatement premiums, stemming from the California wildfires.

Full-Year Highlights

For 2017, Greenlight Capital reported loss per share of $1.21 versus income of $1.20 earned in 2016.

Revenues of $645.7 million improved 9.7% over 2016 owing to higher premiums earned.

Total expenses of $690.5 million increased 27.6% over 2016 on higher loss and loss adjustment expenses, acquisition costs and general and administrative expenses.

Combined ratio of 108.6% deteriorated 500 basis points year over year.

Financial Update

Cash and cash equivalents were $1.5 billion as of Dec 31, 2017, improved from $1.2 billion as of Dec 31, 2016.

Total assets of $3.4 billion as of Dec 31, 2017 increased from $2.7 billion as of Dec 31, 2016.

Total liabilities of $2.5 billion deteriorated from $1.8 billion at 2016-end.

Shareholders' equity at 2017-end totaled $831.3 million, lowered from $874.2 million as of Dec 31, 2016.

Adjusted book value per share was $22.22 as of Dec 31, 2017, declining 5% from $23.38 as of Dec 31, 2016.

Zacks Rank

Greenlight Capital carries a Zacks Rank #5 (Strong Sell).

You can see the complete list of today's Zacks #1Rank (Strong Buy) stocks here .

Performance of Other Insurers

Among other players from the insurance industry that have reported fourth-quarter earnings so far, the bottom line of The Progressive Corp. PGR , The Travelers Companies, Inc. TRV and RLI Corp. RLI beat the respective Zacks Consensus Estimate.

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RLI Corp. (RLI): Free Stock Analysis Report

The Travelers Companies, Inc. (TRV): Free Stock Analysis Report

Progressive Corporation (The) (PGR): Free Stock Analysis Report

Greenlight Reinsurance, Ltd. (GLRE): Free Stock Analysis Report

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


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

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