Assurant, Inc. (AIZ) shares are trading at a discount compared to the Zacks Multi-line Insurance industry. Its forward price-to-book value of 2.14X is lower than the industry average of 2.52X, the Finance sector’s 4.06X and the Zacks S&P 500 Composite’s 7.98X. The multi-line insurer has a Value Score of B.The insurer has a market capitalization of $10.79 billion. The average volume of shares traded in the last three months was 0.4 million. The insurer has a solid track record of beating earnings estimates i ...

It has been about a month since the last earnings report for Assurant (AIZ) . Shares have lost about 2.8% in that time frame, outperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Assurant due for a breakout? 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 drivers.How Have Estimates Been Moving Since Then?It turns out, ...

Group 1 - Assurant Inc. is an insurance company that focuses on capital-light market segments with recurring revenue streams, such as mobile device insurance, auto renters, and mortgages, which are considered less risky compared to other insurance lines [1] - The company has demonstrated long-term stability and growth potential due to its focus on less volatile insurance products [1]

Financial Performance - Assurant reported total assets of $35.02 billion and a debt to total capital ratio of 29.0% as of December 31, 2024[19]. - In 2024, net earned premiums, fees, and other income for the Global Lifestyle segment reached $8.97 billion, up from $8.56 billion in 2023, representing a growth of 4.8%[35]. - The Connected Living segment generated $4.81 billion in net earned premiums, fees, and other income in 2024, an increase of 9.8% from $4.38 billion in 2023[35]. - The Global Automotive segment reported $4.16 billion in net earned premiums, fees, and other income in 2024, a slight decrease of 0.6% from $4.18 billion in 2023[35]. - The total net earned premiums, fees, and other income for Global Housing in 2024 is projected to be $2,457.0 million, up from $2,142.9 million in 2023, reflecting a growth of approximately 14.7%[54]. - Segment Adjusted EBITDA for Global Housing increased to $671.2 million in 2024 from $574.2 million in 2023, representing a growth of about 16.9%[54]. - Assurant returned $455.8 million to shareholders through share repurchases and dividends in 2024[27]. Market Trends and Opportunities - The mobile protection market is expanding, with growth opportunities in bundled protection products and enhanced customer experiences through digital solutions and AI[44]. - U.S. new vehicle sales have improved slightly in 2023, driven by increased vehicle availability and OEM incentives[47]. - The U.S. renters insurance market is growing, with opportunities to increase market share through investments in digital platforms and expanded offerings[67]. - The company aims to grow its portfolio by strengthening partnerships and investing in technology, including digital and AI solutions[22]. Innovation and Technology - The company opened its Innovation and Device Care Center in October 2024 to enhance mobile device lifecycle solutions and leverage automation and AI[26]. - Assurant is investing in technology, including artificial intelligence, to enhance customer experience and operational efficiency, with ongoing expenses related to digital capabilities and research and development[169]. Employee and Talent Management - As of December 31, 2024, Assurant had approximately 14,200 employees, with 75% located in North America and 60% of the global workforce being women[75]. - The global turnover rate for 2024 was 13%, with a 5% turnover for managerial roles and 17% for frontline employees, reflecting a year-over-year improvement of 2 and 1 percentage points respectively[76]. - Assurant's talent strategy includes establishing Global Capability Centers to leverage global scale and access to top talent, enhancing client growth and innovation[77]. - The company is committed to a hybrid work model, with a majority of employees working virtually, supporting both business and talent strategies[89]. - Assurant invests in employee learning and development through various initiatives, including access to industry-leading content and a mentorship program[90]. Regulatory and Compliance - The company is subject to extensive federal, state, and international regulations, which vary by jurisdiction[105]. - The company is licensed to sell insurance in all 50 states, Puerto Rico, and the District of Columbia, ensuring compliance with local regulations[108]. - The National Association of Insurance Commissioners (NAIC) has established risk-based capital (RBC) standards to assess insurer solvency, which could change in the future[110]. - The SEC adopted new rules in July 2023 requiring public companies to disclose material cybersecurity incidents and risk management strategies[130]. - The NAIC has adopted a model bulletin regarding the use of artificial intelligence by insurers, with approximately 20 states having adopted it and further adoption expected[131]. Risk Management - The company’s risk management framework is reviewed annually to align with business operations and changes in laws and regulations[137]. - Significant risks include reliance on a few major clients, which could adversely affect revenues and profits if relationships deteriorate or contracts are not renewed on favorable terms[156]. - The company faces macroeconomic risks that could materially impact its financial condition and results of operations[157]. - Financial risks include potential declines in mobile device values and regulatory compliance issues that could affect sales[159]. - The company utilizes a three lines of defense model for risk management, with the first line being business operations, the second line being Global Risk Management and Compliance, and the third line being Internal Audit[147]. Competitive Landscape - The company faces competition from various sectors, including insurance, warranty, financial services, and technology, requiring continuous adaptation to market changes[73]. - The company faces significant competitive pressures from various sectors, including insurance, financial services, and technology, which could adversely affect revenues and profits[166]. - There is a risk that clients may obtain more favorable terms from competitors, impacting the persistency of policies and overall revenues[167]. Environmental and Climate Risks - Catastrophe and non-catastrophe losses, influenced by climate change and inflation, could significantly reduce profitability and impact financial condition[191]. - Increased unpredictability of weather-related events may lead to higher claims and catastrophe losses, adversely affecting results of operations[192]. - General inflationary pressures and supply chain disruptions have increased costs of claims, particularly in Global Housing and Global Automotive businesses[198]. Financial Health and Investments - The company reported a $0.8 million unfavorable impact to net income in 2024 due to foreign exchange-related losses[205]. - A downgrade of the company's senior debt credit ratings could adversely affect liquidity, increase borrowing costs, and reduce demand for debt securities[204]. - The company is subject to interest rate risk, with fluctuations potentially leading to unrealized losses in its investment portfolio[213]. - The company's investment portfolio is exposed to credit risk, particularly from corporate bonds and other fixed-income securities, which could lead to realized investment losses[215].

Core Viewpoint - Assurant, Inc. (AIZ) has shown strong performance with a 14.9% increase in share price over the past year, outperforming the industry growth of 11.1% and the Finance sector's return of 25.6% [1] Performance Metrics - AIZ's current stock price is $200.14, trading above its 200-day simple moving average (SMA) of $192.78, indicating solid upward momentum [3] - The average volume of shares traded in the last three months was 0.3 million, with a market capitalization of $10.26 billion [1] Growth Projections - The Zacks Consensus Estimate for AIZ's 2025 earnings per share indicates a year-over-year increase of 1.4%, with revenues projected at $12.40 billion, reflecting a 3.7% improvement [4] - For 2026, earnings per share and revenues are expected to increase by 13.2% and 3.8%, respectively, compared to 2024 estimates [4] Earnings History - AIZ has experienced earnings growth of 16.6% over the past five years, surpassing the industry average of 9.7% [5] - The company has a strong earnings surprise history, exceeding earnings estimates in each of the last four quarters by an average of 17.03% [7] Valuation Metrics - AIZ is trading at a forward 12-month price-to-book ratio of 2.01X, which is lower than the industry average of 2.38X, indicating a compelling investment opportunity [8] - The company has a Value Score of A, suggesting attractive valuations [8] Return on Capital - AIZ's return on equity in the trailing 12 months was 17.2%, outperforming the industry average of 15.1% [11] - The return on invested capital (ROIC) was 11.2%, significantly higher than the industry average of 2.3%, reflecting efficient capital utilization [12] Strategic Focus - Assurant is focusing on growing fee-based capital-light businesses, which currently account for 52% of segmental revenues, with expectations for double-digit growth in the long term [13] - The company is ramping up its Connected Living platform, aiming to double margins to 8% over the long term [14] Capital Management - Assurant's board approved an 11% increase in cash dividends, marking 20 consecutive quarters of dividend hikes [15] - The company has $351 million remaining under its current share repurchase authorization, with expected repurchases for 2025 ranging between $200 million and $300 million [15] Overall Assessment - AIZ's strong performance in the Global Lifestyle business, growth in fee-based capital-light sectors, solid capital management, and favorable growth estimates present significant growth opportunities [16] - The company has a VGM Score of B, indicating attractive value, growth, and momentum compared to peers [17]

Financial Data and Key Metrics Changes - In 2024, the company achieved a 15% growth in adjusted EBITDA, reaching over $1.5 billion, and a 19% increase in adjusted earnings per share, exceeding $20, both excluding catastrophes [8][27] - The fourth quarter saw a 13% increase in adjusted EBITDA and earnings per share, both excluding catastrophes, driven primarily by Global Housing [29] Business Line Data and Key Metrics Changes - Global Lifestyle's Connected Living segment grew 9% excluding $25 million of investments and $12 million of unfavorable foreign exchange [28] - Global Auto experienced an 11% decline in results compared to the previous year, primarily due to lower real estate joint venture partnership income [36] - Global Housing's adjusted EBITDA was $225 million in the fourth quarter, with a 32% increase excluding catastrophes, benefiting from robust policy growth in homeowners [38][39] Market Data and Key Metrics Changes - The company reported a year-over-year increase of 16% in policies in force for the lender-placed homeowners business, driven by hard insurance markets [54] - The company has renewed significant client relationships, including major mobile carriers and financial institutions, enhancing its market position [17] Company Strategy and Development Direction - The company is focused on executing and scaling new partnerships and program launches, particularly in lifestyle and housing, with expectations of a one-year payback on investments made in 2024 [23] - The company aims to leverage its B2B2C business model to enhance customer experiences and drive growth through innovative solutions [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term outlook for Global Automotive, citing stabilization in earnings due to targeted actions [12] - The company anticipates modest growth in adjusted EBITDA and earnings per share for 2025, driven by strong underlying trends despite foreign exchange headwinds [41][43] Other Important Information - The company returned over $450 million to shareholders in 2024, including $300 million in share repurchases, and has increased its common stock dividend by 11% [31][32] - The company was added to the S&P High Yield Dividend Aristocrats Index, highlighting its strong capital returns [32] Q&A Session Summary Question: Can you talk about the Homeowners business and the placement rate? - Management noted a 16% year-over-year increase in policies in force, with strong growth driven by client growth and market conditions in California [54][55] Question: How do you see top-line growth in Global Lifestyle? - Management expressed excitement about growth in Connected Living, emphasizing the importance of securing mobile clients and optimizing customer experience [58][60] Question: Are you seeing elevated losses in Global Auto? - Management indicated that losses have stabilized, with expectations for growth in 2025 [74][76] Question: What is the outlook for reinsurance renewal costs? - Management expects to maintain a consistent program structure with favorable pricing due to strong relationships with reinsurers [103][106] Question: How do tariffs impact input costs? - Management has not included tariffs in their guidance due to uncertainty but is monitoring potential impacts on consumer demand and input costs [109][111] Question: What is the outlook for the combined ratio in the Housing segment? - Management expects a mid-80s combined ratio for 2025, even with anticipated losses from California wildfires [91][125] Question: How can the company be better appreciated in the market? - Management emphasized the strength and resilience of the housing business and the need to communicate its unique value proposition more effectively [128][130]

Keith Meier Executive Vice President & Chief Financial Officer Cautionary Statement Some of the statements in this presentation, including our business and financial plans and any statements regarding our anticipated future financial performance, business prospects, growth, operating strategies, valuation and similar matters, such as performance outlook, financial objectives, business drivers, our ability to gain market share, and the strength, diversity, predictability and resiliency of enterprise and segm ...

Core Viewpoint - Assurant, Inc. reported strong fourth-quarter 2024 results, with net operating income and total revenues exceeding expectations, driven by growth in Global Housing and Connected Living segments [1][2]. Financial Performance - Fourth-quarter net operating income was $4.79 per share, beating the Zacks Consensus Estimate by 10.6%, and increased 5% year over year [1]. - Total revenues rose 4.4% year over year to $3.1 billion, surpassing the Zacks Consensus Estimate by 2.6% [2]. - Adjusted EBITDA, excluding reportable catastrophes, increased 13% to $431.5 million [2]. Expense Analysis - Total benefits, losses, and expenses increased 3.5% to $2.8 billion, primarily due to higher policyholder benefits and administrative expenses, exceeding the estimate of $2.6 billion [3]. Segmental Performance - Global Housing net earned premiums, fees, and other income increased 19% to $647.4 million, driven by Homeowners' growth, beating the Zacks Consensus Estimate of $607 million [4]. - Adjusted EBITDA for Global Housing was $225.4 million, up 21% year over year, with a 32% increase when excluding reportable catastrophes [5]. - Global Lifestyle net earned premiums, fees, and other income rose 2% to $2.3 billion, driven by Connected Living growth, exceeding the Zacks Consensus Estimate of $2.2 billion [6]. - Adjusted EBITDA for Global Lifestyle decreased 6% year over year to $191.7 million, primarily due to lower results in Global Automotive [7]. Full-Year Highlights - Adjusted earnings for 2024 increased 7% to $16.64 per share, beating the Zacks Consensus Estimate by 2.7% [9]. - Total net earned premiums, fees, and other income from Global Lifestyle and Global Housing segments totaled $11.42 billion, up 7% [9]. - Adjusted EBITDA for the full year, excluding reportable catastrophes, increased 15% to $1.5 billion [9]. Financial Position - As of December 31, 2024, liquidity was $673 million, significantly above the targeted minimum level of $225 million [11]. - Total assets increased 4.1% to $35 billion, while total shareholders' equity rose 6.2% year over year to $5.1 billion [11]. Share Repurchase and Dividend Update - In 2024, Assurant repurchased 1.5 million shares for $300 million and paid $156 million in dividends, with $351 million remaining under the current repurchase authorization [12]. 2025 Guidance - Assurant expects adjusted EBITDA, excluding reportable catastrophes, to increase modestly in 2025, with growth projected in both Global Lifestyle and Global Housing segments [13][14]. - Adjusted earnings per diluted share growth rate is expected to increase modestly, with an effective tax rate projected at approximately 20% to 22% [15].

Core Insights - Assurant (AIZ) reported $3.13 billion in revenue for Q4 2024, a year-over-year increase of 4.4%, with an EPS of $4.79 compared to $4.58 a year ago, exceeding both revenue and EPS consensus estimates [1] Financial Performance - Net investment income was $137.80 million, slightly above the average estimate of $134.09 million, but down 5.3% year-over-year [4] - Fees and other income totaled $438.60 million, below the average estimate of $447.09 million, reflecting a year-over-year increase of 1% [4] - Net earned premiums, fees, and other income reached $3 billion, surpassing the average estimate of $2.47 billion, marking a 4.9% year-over-year increase [4] Segment Performance - Global Housing revenues were $684.60 million, exceeding the estimated $636.93 million, with an 18.1% year-over-year increase [4] - Global Lifestyle revenues amounted to $2.44 billion, slightly above the estimated $2.39 billion, with a year-over-year increase of 1.2% [4] - Corporate & Other revenues were reported at $6.70 million, below the estimated $8.15 million, but showed a year-over-year increase of 15.5% [4] Investment Metrics - Global Housing net earned premiums were $603 million, exceeding the average estimate of $560.59 million, reflecting a year-over-year increase of 17.5% [4] - Global Housing fees and other income were $44.40 million, slightly below the average estimate of $46.54 million, with a significant year-over-year increase of 35.8% [4] - Global Lifestyle net investment income was $92.30 million, close to the average estimate of $92.66 million, but down 11.1% year-over-year [4]

Core Viewpoint - Assurant reported quarterly earnings of $4.79 per share, exceeding the Zacks Consensus Estimate of $4.33 per share, and showing an increase from $4.58 per share a year ago, indicating a 10.62% earnings surprise [1][2] Financial Performance - The company achieved revenues of $3.13 billion for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 2.60% and up from $3 billion year-over-year [2] - Over the last four quarters, Assurant has consistently surpassed consensus EPS estimates and revenue estimates [2] Stock Performance and Outlook - Assurant shares have declined approximately 0.3% since the beginning of the year, while the S&P 500 has gained 3.1% [3] - The company's earnings outlook is crucial for future stock performance, with current consensus EPS estimates at $4.69 for the next quarter and $17.95 for the current fiscal year [4][7] Industry Context - The Insurance - Multi line industry, to which Assurant belongs, is currently ranked in the top 35% of over 250 Zacks industries, suggesting a favorable environment for stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]