Why Is W.R. Berkley (WRB) Up 5.9% Since Last Earnings Report?

A month has gone by since the last earnings report for W.R. Berkley (WRB). Shares have added about 5.9% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is W.R. Berkley due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts. W.R. Berkley Q4 Earnings, Revenues Top, Premiums Rise Y/YW.R. Berkley Corporation’s fourth-quarter 2024 operating income of $1.13 per share beat the Zacks Consensus Estimate by 20.2%. The bottom line improved 17.7% year over year. The insurer benefited from higher premiums and improved net investment income, partially offset by wider catastrophe losses and escalated expenses.Behind the HeadlinesW.R. Berkley’s net premiums written were $2.9 billion, up 8% year over year. The figure was lower than our estimate of $3 billion.Operating revenues came in at $3.5 billion, up 9.2% year over year, on the back of higher net premiums earned as well as improved net investment income, higher insurance service fees and other income. The top line beat the consensus estimate by 4.2%.Net investment income grew 1.3% to $317.4 million, driven by strong contributions to total return from net unrealized gains on the equity portfolio. The figure was lower than our estimate of $399.5 million. The Zacks Consensus Estimate was pegged at $342 million.Total expenses increased 8% to $2.9 billion due to higher losses and loss expenses. Our estimate was $3 billion. The loss ratio deteriorated 180 basis points (bps) to 61.8, while the expense ratio remained unchanged year over year at 28.4.Catastrophe losses of $79.6 million in the quarter were wider than the $32 million incurred in the year-ago quarter. The consolidated combined ratio (a measure of underwriting profitability) deteriorated 180 bps year over year to 90.2. The Zacks Consensus Estimate was 91.Segment DetailsNet premiums written at the Insurance segment increased 9.8% year over year to $2.6 billion in the quarter, primarily due to higher premiums from other liability, short-tail lines, auto, workers' compensation and professional liability. The figure was lower than our estimate of $2.7 billion. The combined ratio deteriorated 110 bps to 90.5, which matched the Zacks Consensus Estimate. Our estimate was 91.2.Net premiums written in the Reinsurance & Monoline Excess segment decreased 5.5% year over year to $316 million due to lower premiums at Casualty. The figure was lower than our estimate of $323.3 million. The combined ratio deteriorated 690 bps to 88.4, which matched the Zacks Consensus Estimate. Our estimate was 90.1.Full-Year HighlightsOperating income of $4.14 per share beat the Zacks Consensus Estimate by 4.8%. The bottom line improved 26.2% year over year.Operating revenues came in at $13.52 billion, up 11.7% year over year, on the back of higher net premiums earned as well as improved net investment income and increased insurance service fees and other income. The top line came in line with the consensus estimate.Net investment income grew 26.6% year over year to a record of $1.3 billion.W.R. Berkley’s net premiums written were $12 billion, up 9.3% year over year. The figure matched our estimate.Pre-tax underwriting income was $1.1 billion. The consolidated combined ratio was 90.3, which deteriorated 60 bps year over year.Financial UpdateW.R. Berkley exited 2024 with total assets worth $40.6 billion, up 9% from year-end 2023. Senior notes and other debt increased 0.1% from 2023 end levels to $1.8 billion.Book value per share increased 14% from 2023 end levels to $22.09 as of Dec. 31, 2024.Cash flow from operations was $3.7 billion in 2024, up 25.6% year over year.Operating return on equity expanded 110 bps to 24.3%.Capital DeploymentWRB returned $287.8 million, consisting of $67.4 million in share repurchases, $190 million in special dividends and $30.4 million in regular dividends.How Have Estimates Been Moving Since Then?It turns out, estimates revision flatlined during the past month.VGM ScoresAt this time, W.R. Berkley has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookW.R. Berkley has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.Performance of an Industry PlayerW.R. Berkley belongs to the Zacks Insurance - Property and Casualty industry. Another stock from the same industry, Travelers (TRV), has gained 1.6% over the past month. More than a month has passed since the company reported results for the quarter ended December 2024.Travelers reported revenues of $12.06 billion in the last reported quarter, representing a year-over-year change of +10.3%. EPS of $9.15 for the same period compares with $7.01 a year ago.For the current quarter, Travelers is expected to post earnings of $0.56 per share, indicating a change of -88.1% from the year-ago quarter. The Zacks Consensus Estimate has changed -88.1% over the last 30 days.Travelers has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report W.R. Berkley Corporation (WRB): Free Stock Analysis Report The Travelers Companies, Inc. (TRV): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks