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Yahoo
23-07-2025
- Business
- Yahoo
Why Chubb Stock Wilted on Wednesday
Key Points The company did well in its second quarter, but it suffers from being in an unpopular category. Many market players are disinterested in "defensive" stocks just now. 10 stocks we like better than Chubb › Chubb (NYSE: CB) stock seemed to be primed for a good Wednesday on the market after it reported quarterly results, however, investors had other plans for the storied insurance company. While it beat analyst estimates for its latest quarter, some of its fundamentals raised concerns. As a result they collectively traded out of the stock, leaving it with a more than 4% loss in price on the day around 3 p.m. ET. Negative reaction to positive developments After market hours Tuesday, Chubb published its second-quarter results. These revealed that the company's net premiums written -- considered something of a top-line metric by insurance sector investors -- rose by 6% year-over-year to just shy of $14.2 billion. Net income was slightly under $3 billion, up from the year-ago quarter's $2.2 billion. The company's "core operating income," i.e. under non-GAAP (adjusted) standards, rose to $6.14 per-share from the year-ago profit of $5.38. On average, analysts tracking Chubb stock were estimating the company would book revenue of $14.16 billion, and core operating income of $5.96 per share. In its earnings press release, management attributed the improvements to strength in various markets. It quoted CEO Evan Greenberg as saying that "most all of our businesses and regions of the world contributed to record quarterly results, illustrating the distinctive, diversified nature of our company." The trend is against it The market's reaction to Chubb's generally fine quarter likely had more to do with external factors than dissatisfaction with the company. Many investors are turning away from defensive stocks these days, and that includes sturdy insurance titles like Chubb. In such an environmentm the company probably needed to deliver a spectacular quarter, rather than one that was "merely" above average in order to impress investors. Should you invest $1,000 in Chubb right now? Before you buy stock in Chubb, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Chubb wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $641,800!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,023,813!* Now, it's worth noting Stock Advisor's total average return is 1,034% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Why Chubb Stock Wilted on Wednesday was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
22-07-2025
- Business
- Reuters
Insurer Chubb's second-quarter profit rises on strong underwriting business, investment income
July 22 (Reuters) - Insurance company Chubb reported a rise in second-quarter profit on Tuesday, helped by improved underwriting performance and investment returns. Macroeconomic volatility and the unpredictable impact of severe weather events, particularly wildfires and hurricanes, have sustained demand for risk mitigation offered by insurance products. Stronger underwriting reflects an insurer's ability to price risk effectively, bolstering profits despite higher claims. The insurer's net investment income surged 6.8% to a record $1.57 billion during the reported quarter. Chubb's global P&C (property and casualty) net premiums written, excluding agriculture, increased 5.8% to $11.66 billion for the three months ended June 30. "We produced a record $2.5 billion in core operating income, up nearly 13% from a year ago, with operating EPS up 14%, driven by record underwriting and strong investment income, and double-digit growth in life income," Chubb CEO Evan Greenberg said. Last week, industry bellwether Travelers (TRV.N), opens new tab exceeded Wall Street profit estimates, also benefiting from effective underwriting and portfolio management. Chubb reported a property and casualty combined ratio of 85.6%, compared to 86.8% a year earlier. A ratio below 100% indicates the insurer earned more in premiums than it paid out in claims. The company's core operating income, net of tax, rose to $2.48 billion, or $6.14 per share, in the quarter, compared with $2.20 billion, or $5.38 per share, a year earlier.
Yahoo
31-01-2025
- Business
- Yahoo
Chubb Ltd (CB) Q4 2024 Earnings Call Highlights: Strong Growth Amidst Challenges
Core Operating Income: $2.5 billion for Q4 2024, up 9.4% pre-tax, 10.5% per share. Global P&C Premium Revenue Growth: 6.7% in Q4 2024. Life Insurance Premium Growth: 8.5% in constant dollars for Q4 2024. Combined Ratio: 85.7% for Q4 2024. Adjusted Net Investment Income: $1.7 billion for Q4 2024, up 13.7%. Fixed Income Portfolio Yield: 5% for Q4 2024. North America Premium Growth: 6.3% excluding Agriculture for Q4 2024. International Retail Business Premium Growth: 7.7% for Q4 2024. Global Reinsurance Premium Growth: 20% for Q4 2024. Adjusted Operating Cash Flow: $4.2 billion for Q4 2024. Capital Returned to Shareholders: $1.1 billion in Q4 2024, including $725 million in share repurchases and $367 million in dividends. Core Operating ROE: 14.3% for Q4 2024. Core Operating Return on Tangible Equity: 22.0% for Q4 2024. Pre-tax Catastrophe Losses: $607 million for Q4 2024. Warning! GuruFocus has detected 5 Warning Sign with CB. Release Date: January 29, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Chubb Ltd (NYSE:CB) reported record P&C underwriting income with a combined ratio of 85.7% for the fourth quarter of 2024. The company achieved a 9.4% increase in operating earnings on a pre-tax basis, contributing to a strong year with $9.1 billion in operating income. Global P&C premium revenue grew by 6.7% in the quarter, with Life Insurance premiums increasing by 8.5% in constant dollars. Chubb Ltd (NYSE:CB) returned $1.1 billion of capital to shareholders in the quarter, including $725 million in share repurchases. The company's balance sheet remains strong with book value of $64 billion and total invested assets of $151 billion. Chubb Ltd (NYSE:CB) faced a significant financial impact from the California wildfires, estimating a cost of $1.5 billion net pre-tax. The company's financial lines, particularly D&O and employment practices liability insurance, are experiencing increased competition, affecting underwriting margins. Book value was adversely impacted by unrealized mark-to-market losses on the fixed income portfolio due to interest rate changes. The company reported adverse development of $139 million in its corporate runoff portfolio, primarily asbestos-related. Chubb Ltd (NYSE:CB) is facing challenges in the California insurance market due to regulatory constraints on pricing and coverage. Q: Can you provide more details on the $1.5 billion loss estimate from the California wildfires? A: Evan Greenberg, Chairman and CEO, explained that the $1.5 billion is a ground-up estimate based on Chubb's own losses, not industry-wide estimates. It includes an assessment for the FAIR plan but does not account for subrogation. Q: What are your expectations for organic growth in 2025, and are you considering inorganic growth opportunities? A: Evan Greenberg stated that while they do not provide specific guidance, the logic of expecting mid to high single-digit organic growth seems reasonable. Inorganic growth is considered opportunistic and must align with their organic strategies. Q: Can you elaborate on the favorable long-tail reserve development in general casualty? A: Evan Greenberg clarified that reserve development varies by portfolio each quarter. The favorable development this quarter was due to the strength of reserves in the specific casualty portfolios reviewed. Q: How do you view the current competitive environment in financial lines, and what might improve conditions? A: Evan Greenberg noted that while Chubb values financial lines, current pricing is not favorable. He expects conditions to improve as losses emerge and normalize, impacting current accident year margins. Q: What is Chubb's approach to the California insurance market following the wildfires? A: Evan Greenberg highlighted the challenges in California due to regulatory constraints on pricing. Chubb has been reducing exposure in the state and will not write insurance where they cannot achieve a reasonable risk-adjusted return. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
29-01-2025
- Business
- Yahoo
Chubb reports L.A. County fire losses will hit $1.5 billion
Chubb Ltd. is estimating that it will need to pay out $1.5 billion to cover its Los Angeles County fire claims, making the Swiss insurer the first company to report its expected losses from the conflagrations. Chairman and Chief Executive Evan Greenberg said the figure includes the cost of "supporting our customers and helping them recover and rebuild from this catastrophe," according to a statement in the company's fourth-quarter earnings report released Tuesday. "The California wildfire disaster is a terrible tragedy that is still unfolding. Our colleagues have been on the ground from the beginning, endeavoring to assist our policyholders who have lost property, been displaced from their homes and businesses, and had their lives severely disrupted," he said. Chubb, which earned $2.6 billion in the fourth quarter, said it anticipates the financial impact to the company will be limited to the first quarter of this year. Read more: California's FAIR Plan, the home insurer of last resort, may need a bailout after the L.A. fires The size of the loss to Chubb indicates just how large the damages will be for insurers. Chubb had a 2.27% share of the California homeowners market in 2023, putting it outside the top 10 largest home insurers in the state. The Eaton and Palisades fires have consumed nearly 40,000 acres of homes, businesses and landmarks in Altadena and Pacific Palisades and have killed more than two dozen people. Moody's RMS said in a report this week that it expects the fires will weaken insurers first-quarter earnings and raise the price of reinsurance they buy to mitigate the costs of catastrophes — while increasing prices and lowering the availability of homeowners insurance in California neighborhoods at "high- and medium-risk" for wildfires. That will continue to force more homeowners to get insurance from the FAIR Plan, the state's already overloaded insurer of last resort, said the report from Moody's. The state plan provides policies with lower limits that excludes some typical coverage. Read more: Some L.A. fire victims are not getting claims advances as required by law, state says While weather forecasting service AccuWeather puts the fires' total economic loss at $250 billion to $275 billion, that figure includes the costs of healthcare, business disruptions and other economic impacts. Risk modelers have estimated the cost to the insurance industry to pay for property damage, temporary housing costs and other claims at $20 billion to $45 billion. That would make the fires one of the country's worst natural disasters but likely not as costly as Hurricane Katrina in 2005. Sign up for our Wide Shot newsletter to get the latest entertainment business news, analysis and insights. This story originally appeared in Los Angeles Times.
