Let’s dig into the relative performance of Hamilton Insurance Group (NYSE: HG) and its peers as we unravel the now-completed Q2 reinsurance earnings season.
This is a cyclical industry, and the sector benefits when there is 'hard market', characterized by strong premium rate increases that outpace loss and cost inflation, resulting in robust underwriting margins. The opposite is true in a 'soft market'. Interest rates also matter, as they determine the yields earned on fixed-income portfolios. The primary headwind remains the immense and concentrated exposure to large-scale catastrophe losses, as the growing impact of climate change challenges traditional risk models and creates significant earnings volatility. Additionally, they face the risk of adverse prior-year reserve development, where claims prove more costly than anticipated, while the eventual influx of new capital from alternative sources threatens to soften the market and compress future returns.
The 6 reinsurance stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 4.1%.
In light of this news, share prices of the companies have held steady as they are up 2.6% on average since the latest earnings results.
Best Q2: Hamilton Insurance Group (NYSE: HG)
Founded in 2013 and operating through three distinct underwriting platforms across four countries, Hamilton Insurance Group (NYSE: HG) operates global specialty insurance and reinsurance platforms across Lloyd's, Ireland, Bermuda, and the United States.
Hamilton Insurance Group reported revenues of $740.8 million, up 26% year on year. This print exceeded analysts’ expectations by 22.1%. Overall, it was an exceptional quarter for the company with a beat of analysts’ EPS estimates and a solid beat of analysts’ book value per share estimates.
Hamilton Insurance Group achieved the biggest analyst estimates beat and fastest revenue growth of the whole group. Unsurprisingly, the stock is up 11.2% since reporting and currently trades at $23.96.
Is now the time to buy Hamilton Insurance Group? Access our full analysis of the earnings results here, it’s free.
RenaissanceRe (NYSE: RNR)
Born in Bermuda after the devastating Hurricane Andrew created a crisis in the catastrophe insurance market, RenaissanceRe (NYSE: RNR) provides property, casualty, and specialty reinsurance and insurance solutions to customers worldwide, primarily through intermediaries.
RenaissanceRe reported revenues of $3.21 billion, up 13.4% year on year, outperforming analysts’ expectations by 8.7%. The business had an exceptional quarter with a beat of analysts’ EPS estimates and a solid beat of analysts’ book value per share estimates.
The market seems content with the results as the stock is up 1.7% since reporting. It currently trades at $241.41.
Is now the time to buy RenaissanceRe? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Reinsurance Group of America (NYSE: RGA)
Operating behind the scenes of the insurance industry since 1973, Reinsurance Group of America (NYSE: RGA) provides life and health reinsurance services to insurance companies, helping them manage risk and meet regulatory requirements.
Reinsurance Group of America reported revenues of $5.68 billion, up 10.9% year on year, exceeding analysts’ expectations by 1.1%. Still, it was a slower quarter as it posted a significant miss of analysts’ net premiums earned estimates and a significant miss of analysts’ EPS estimates.
The stock is flat since the results and currently trades at $193.44.
Read our full analysis of Reinsurance Group of America’s results here.
Everest Group (NYSE: EG)
Rebranded from Everest Re in 2023 to reflect its evolution beyond just reinsurance, Everest Group (NYSE: EG) underwrites property and casualty reinsurance and insurance worldwide, serving insurance companies, corporations, and other clients across six continents.
Everest Group reported revenues of $4.49 billion, up 6.2% year on year. This print beat analysts’ expectations by 1.7%. Overall, it was a strong quarter as it also produced a solid beat of analysts’ net premiums earned estimates and a beat of analysts’ EPS estimates.
Everest Group had the slowest revenue growth among its peers. The stock is up 1.6% since reporting and currently trades at $339.88.
Read our full, actionable report on Everest Group here, it’s free.
Fidelis Insurance (NYSE: FIHL)
Founded in Bermuda in 2014 and designed to adapt nimbly to evolving market conditions, Fidelis Insurance (NYSE: FIHL) is a global specialty insurer and reinsurer that provides customized coverage across property, specialty, and bespoke risk solutions.
Fidelis Insurance reported revenues of $589.3 million, up 9.1% year on year. This number lagged analysts' expectations by 8.9%. Aside from that, it was a satisfactory quarter as it also produced a beat of analysts’ EPS estimates but a significant miss of analysts’ net premiums earned estimates.
Fidelis Insurance had the weakest performance against analyst estimates among its peers. The stock is flat since reporting and currently trades at $17.29.
Read our full, actionable report on Fidelis Insurance here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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