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ProAssurance (PRA) Q2 Earnings Beat Estimates, Improve Y/Y

ProAssurance Corporation' s PRA second-quarter 2018 operating earnings per share of 48 cents beat the Zacks Consensus Estimate by 26.3%. Moreover, the bottom line improved 20% year over year, mainly driven by growth in its three operating segments along with overall renewal pricing.

ProAssurance Corporation Price and EPS Surprise

ProAssurance Corporation Price and EPS Surprise | ProAssurance Corporation Quote

ProAssurance's quarterly operating revenues grew 21% to $248 million from the prior-year quarter's level on the back of higher premiums. Also, the top line surpassed the Zacks Consensus Estimate by 12.7%.

Quarterly Operational Update

Gross premiums written increased 17.8% year over year to $242 million, primarily banking on higher premiums across Specialty P&C Insurance, Lloyd's Syndicates and Workers' Compensation segments. Also, net premiums earned rose 18.3% year over year.

Net investment income dipped nearly 1.3% year over year to $22 million.

Total expenses escalated 22.4% year over year to $228.1 million. This rise in costs mainly stemmed from higher net loss and loss adjustment expenses as well as underwriting, policy acquisition and operating expenses.

Quarterly Segment Results

Specialty P&C Insurance Segment

Total revenues of $140 million surged 31.4% year over year.

Gross premiums written were $147 million, up 18.5% from the year-ago quarter's figure.

Total expenses of $140 million mounted 36.4% year over year, primarily due to net loss and loss adjustment expenses.

Workers' Compensation Segment

Total revenues of $62 million rose 9.5% year over year courtesy of gross premiums written as well as net premiums earned.

Gross premiums written were $70 million, up 19.2% over the year-earlier period's number.

Total expenses of $58 million increased 9.1 % year over year.

Lloyd's Syndicate Segment

Total revenues of $17 million declined 19.2% year over year.

Gross premiums written were $24 million, up 3.8% from the figure acquired in comparable quarter last year.

Total expenses of $20 million rose 16.7% year over year.

Corporate Segment

Total revenues of $31 million increased 33.4% year over year.

Operating expenses of $5.6 million decreased 27.5% over the year-ago quarter's level. Interest expense of $3.9 million declined 4.5% year over year.

Financial Position

As of Jun 30, 2018, ProAssurance's total investments were $3.3 billion, down 9% from the number registered at year-end 2017.

At second-quarter end, the company's total assets were $4.5 billion, down 7% from the count at 2017 end.

As of Jun 30, 2018, the insurer's shareholder equity dipped 1.3% to $1.5 billion from the tally as of Dec 31, 2017.

Share Repurchase & Dividend Update

The company did not buy back any shares in the reported quarter. As of Jul 31, 2018, it had approximately $110 million of shares available under its board-authorized stock repurchase program.

In May, the company's board members approved a regular dividend of 31 cents, paid in July.

Notably, within a span of almost 11 years, the company has been able to return more than $2 billion to its shareholders through regular and special dividends.

Zacks Rank

ProAssurance carries a Zacks Rank #5 (Strong Sell).

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

Performance of Other Insurers

Among other players from the insurance industry having already reported second-quarter earnings, the bottom line of The Progressive Corporation PGR , MGIC Investment Corporation MTG and RLI Corp. RLI surpassed the respective Zacks Consensus Estimate.

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MGIC Investment Corporation (MTG): Free Stock Analysis Report

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ProAssurance Corporation (PRA): Free Stock Analysis Report

The Progressive Corporation (PGR): 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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