Core Viewpoint - Amerisafe reported quarterly earnings of $0.60 per share, exceeding the Zacks Consensus Estimate of $0.59, but down from $0.69 per share a year ago, indicating a mixed performance in earnings despite a slight surprise [1][2] Earnings Performance - The company achieved an earnings surprise of 1.69% for the recent quarter and had a previous quarter surprise of 11.67% with earnings of $0.67 per share against an expectation of $0.60 [1][2] - Over the last four quarters, Amerisafe has surpassed consensus EPS estimates three times [2] Revenue Analysis - Amerisafe's revenues for the quarter ended March 2025 were $75.75 million, which missed the Zacks Consensus Estimate by 1.41% and decreased from $75.94 million year-over-year [2] - The company has only topped consensus revenue estimates once in the last four quarters [2] Stock Performance - Amerisafe shares have declined approximately 4.9% since the beginning of the year, while the S&P 500 has seen a decline of 6% [3] - The immediate price movement of the stock will largely depend on management's commentary during the earnings call [3] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.55 on revenues of $77.84 million, and for the current fiscal year, it is $2.25 on revenues of $313.17 million [7] - The estimate revisions trend for Amerisafe is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Insurance - Accident and Health industry is currently ranked in the top 34% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [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]

Financial Performance - Net premiums earned for Q1 2025 were $68,885,000, a slight increase of 0.6% from $68,446,000 in Q1 2024[3] - Net income for Q1 2025 decreased by 47.1% to $8,949,000 compared to $16,925,000 in Q1 2024[3] - Diluted earnings per share (EPS) fell by 46.6% to $0.47 in Q1 2025 from $0.88 in Q1 2024[3] - Gross premiums written increased by 4.6% to $83,784,000 in Q1 2025, up from $80,074,000 in Q1 2024[4] - The net combined ratio for Q1 2025 was 89.1%, compared to 87.3% in Q1 2024[4] - Net investment income decreased by 9.7% to $6,652,000 in Q1 2025 from $7,366,000 in Q1 2024[7] - The underwriting expense ratio increased to 29.9% in Q1 2025, up from 27.3% in Q1 2024, reflecting continued investment in the business[6] - The effective tax rate for Q1 2025 was 20.2%, compared to 18.4% in Q1 2024[6] Shareholder Information - Book value per share at March 31, 2025, was $13.69, a decrease of 13.0% from $15.74 at the same time last year[3] - The company declared a quarterly cash dividend of $0.39 per share, representing a 5.4% increase compared to 2024[8] Asset and Liability Changes - Total assets decreased slightly from $1,157,791 million in December 2024 to $1,156,717 million in March 2025, a decline of 0.09%[27] - Investments decreased from $788,778 million to $781,012 million, a reduction of approximately 0.98%[27] - Premiums receivable, net increased from $142,659 million to $156,746 million, reflecting a growth of 9.87%[27] - Reserves for loss and loss adjustment expenses decreased from $651,309 million to $639,965 million, a decline of 1.84%[27] - Unearned premiums increased from $121,926 million to $132,646 million, an increase of 8.77%[27] - Shareholders' equity increased from $257,341 million to $260,813 million, a growth of 1.93%[27] - Other liabilities decreased from $112,363 million to $107,405 million, a reduction of 4.03%[27] - Amounts recoverable from reinsurers decreased from $117,019 million to $114,278 million, a decline of 2.35%[27] - Deferred policy acquisition costs increased from $19,151 million to $20,422 million, an increase of 6.64%[27] - Cash and cash equivalents increased slightly from $44,045 million to $44,753 million, a growth of 1.60%[27]

Group 1 - Annaly Capital Management (NLY) has outperformed its Finance sector peers, gaining approximately 7.3% year-to-date, while the average loss in the Finance group is about 1.4% [4] - The Zacks Consensus Estimate for NLY's full-year earnings has increased by 6.2% over the past quarter, indicating a positive trend in analyst sentiment [4] - NLY currently holds a Zacks Rank of 2 (Buy), suggesting a favorable outlook for the stock [3] Group 2 - Annaly Capital Management is part of the REIT and Equity Trust industry, which has seen an average loss of 0.5% this year, further highlighting NLY's strong performance [6] - Another Finance stock, Amerisafe (AMSF), has also outperformed its sector with a year-to-date increase of 3% and holds a Zacks Rank of 2 (Buy) [5] - The Insurance - Accident and Health industry, to which Amerisafe belongs, is currently ranked 38 and has gained 7% year-to-date [6]

Core Viewpoint - Amerisafe (AMSF) shares have increased by approximately 4.3% since the last earnings report, outperforming the S&P 500, raising questions about the sustainability of this positive trend leading up to the next earnings release [1] Group 1: Earnings Report and Estimates - Recent estimates for Amerisafe have trended upward over the past month, indicating a positive outlook for the company [2][4] - The stock has received a Zacks Rank of 2 (Buy), suggesting expectations for above-average returns in the coming months [4] Group 2: VGM Scores - Amerisafe currently holds a poor Growth Score of F, a Momentum Score of D, and a Value Score of D, placing it in the bottom 40% for the value investment strategy [3] - The overall aggregate VGM Score for Amerisafe is F, which is a critical metric for investors not focused on a single strategy [3]

Premiums and Business Performance - The company reported gross premiums written of $294.1 million for the year ended December 31, 2024, an increase from $285.4 million in 2023 and $276.1 million in 2022[44]. - The voluntary business accounted for 97.2% of total gross premiums written in 2024, with a policy renewal rate of 94.2%[36][44]. - In 2024, 14.7% of gross premiums written were derived from Florida, followed by Georgia at 10.3% and Pennsylvania at 7.2%[47]. - Independent agencies accounted for 98.4% of voluntary in-force premiums as of December 31, 2024, with no single agency exceeding 2.0%[49]. - As of December 31, 2024, the company had over 9,300 voluntary business policyholders, with the ten largest accounting for only 2.3% of in-force premiums[36]. - The company derived 3.9% of its voluntary in-force premiums from employers engaged in the maritime industry for the year ended December 31, 2024[158]. - In 2024, 85.4% of gross premiums written were derived from policyholders in the construction, trucking, logging and lumber, agriculture, manufacturing, maritime, and telecommunications industries[186]. Underwriting and Risk Management - The company has a disciplined underwriting approach, with a focus on maintaining adequate rate levels and improving risk selection and pricing[27]. - The underwriting strategy focuses on hazardous industries in profitable states, with specific guidelines excluding certain high-risk activities[50]. - The company’s expense ratio was 29.6% in 2024, which is believed to be lower than that of competitors, enhancing the opportunity for underwriting profit[26]. - The company’s proactive claims management practices resulted in an average of 44 open indemnity claims per field case manager as of December 31, 2024, significantly lower than the industry average[25]. - The company conducts annual premium audits for all voluntary business policyholders to verify payroll expenses and job classifications[62]. - The company stopped accepting direct assignments and only participates in pooling arrangements to fulfill its residual market obligations beginning in 2023[155]. Claims and Reserves - As of December 31, 2024, the company's ultimate liability for loss and loss adjustment expenses is estimated at $538.6 million, including $13.0 million for mandatory pooling arrangements[79]. - The gross unpaid loss, DCC, and AO reserves decreased to $651.3 million in 2024 from $673.9 million in 2023, primarily due to favorable development from prior accident years[87]. - The average unpaid loss and loss adjustment expenses per open claim increased to $171,487 in 2024 from $168,372 in 2023[87]. - The total incurred related to the current accident year for 2024 was $192.2 million, compared to $189.7 million in 2023[86]. - The company recognized $34.9 million of favorable development for prior accident years in 2024[87]. - The company’s loss reserves are based on estimates and may be inadequate to cover actual losses, with substantial judgment required to determine the relevance of historical experience[187]. Investment Portfolio - As of December 31, 2024, the carrying value of the investment portfolio was $832.8 million, while the fair value was $819.5 million[94]. - The majority of fixed maturity securities are classified as "held-to-maturity," with changes in non-credit related unrecognized gains and losses not reflected until realized[97]. - The pre-tax investment yield for the twelve months ended December 31, 2024, was 3.4% per annum[99]. - The average composite rating of the investment portfolio, excluding equity holdings, was "AA-" as of December 31, 2024[104]. - The company limits holdings in equity securities to the lesser of 10% of the investment portfolio or 30% of shareholders' equity, on a fair value basis[97]. - The company periodically reviews its investment portfolio with the risk committee of the board of directors for compliance with the investment policy[96]. Reinsurance - The company has a reinsurance treaty program providing coverage for each loss occurrence up to $100.0 million, with a retention of $2.0 million for each occurrence[109][111]. - Total amounts recoverable from reinsurers as of December 31, 2024, were $117.3 million, net of an allowance for credit losses of $300, resulting in $117.0 million recoverable[116]. - The company evaluates the financial condition of reinsurers and monitors credit risk concentrations continuously to minimize exposure to significant losses[108]. - The company has 26 reinsurers participating in its 2025 reinsurance program, with most rated "A" or better by A.M. Best[113][114]. - The company remains liable to policyholders even if it is unable to recover amounts due from reinsurers, exposing it to credit risk[210]. Regulatory and Compliance - The company is subject to periodic examinations by state insurance departments, with recent examinations covering calendar years 2018 through 2021[151]. - The company is required to participate in residual market programs, which provide workers' compensation insurance to employers unable to obtain coverage[154]. - The company is subject to extensive regulation, which may limit its ability to obtain premium rate increases or take actions to increase profitability[195]. - The company must maintain minimum capital and surplus of $2.0 million under Nebraska law and $5.0 million under Texas law[165]. Employee and Community Engagement - The company has established an endowment to provide scholarships to dependents of employees and community members, emphasizing its commitment to education[131]. - The company invests in employee professional development, including insurance certification programs and leadership training[133]. - The company has launched a new committee to focus on charitable giving and corporate volunteering efforts, enhancing community engagement[130]. - As of December 31, 2024, the company had 362 full-time employees, with an average employee tenure of 10.0 years and 61% of the workforce being female[132].

Financial Data and Key Metrics Changes - AMERISAFE reported a net income of $13.2 million or $0.69 per diluted share for Q4 2024, down from $19.2 million or $1 per diluted share in Q4 2023 [13] - For the full year, net income was $55.4 million compared to $62.1 million in 2023, while net operating income decreased to $48.4 million from $55.9 million [14] - Gross premiums written increased by 3.9% in Q4 and 3.1% for the full year, with net premiums earned growing by 1.2% in Q4 and 1.3% for the year [6][14] - The combined ratio was reported at 88.7% with a return on equity (ROE) of 20.2% [8] Business Line Data and Key Metrics Changes - Voluntary premiums on policies written rose by 8.5% in Q4 and 4.6% for the year compared to 2023, with enforced policy count growing by 9.6% [6][7] - The accident year loss ratio remained steady at 71% for the full year, consistent with the prior year [10] Market Data and Key Metrics Changes - The company experienced strong premium retention with a policy retention rate of 94.1% on a policy basis and 88% on a premium basis for the quarter [37] - The investment portfolio had a net investment income decrease of 14.4% to $6.9 million for Q4 and 6.8% to $29.2 million for the full year [17] Company Strategy and Development Direction - AMERISAFE is focused on top-line growth while maintaining consistent underwriting margins, emphasizing profitable growth in a competitive landscape [6][11] - The company aims to improve agent relationships and enhance its sales-driven culture to capitalize on profitable opportunities [7][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining profitable growth despite industry-wide challenges, including rate reductions [7][11] - The company anticipates favorable development from prior accident years and aims to continue identifying profitable high-risk opportunities [10][11] Other Important Information - The Board of Directors approved a 5.4% increase in the regular dividend to $0.39 per share [11] - The investment portfolio is high quality with an average AA- credit rating and a duration of 4.4 years [19] Q&A Session Summary Question: Can you provide context on the policy count growth of 9.6%? - Management clarified that the 9.6% growth was for the entire year, with a 2.6% growth in the fourth quarter [24][28] Question: How has the average size per policy trended? - The average policy size for 2024 was slightly lower than in 2023, with a noted slowdown in average wages in Q4 [34] Question: What impact did renewal rates have on the top line? - Renewal rates were strong, with a policy retention rate of 94.1% and premium retention at 88% [37] Question: How are the claims from 2021 and 2022 shaping up? - Management indicated that 2021 and 2022 are expected to be good accident years, with favorable development from these years [39] Question: What is the outlook for the construction industry? - Management believes the construction industry remains strong, with continued payroll growth and opportunities for business [74][79] Question: Any updates on large claims for the year? - The company ended the year with 18 claims over a million dollars, which is consistent with the five-year average [81] Question: How is medical inflation affecting costs? - There have been no significant developments regarding medical inflation, but home health costs are being monitored closely [86] Question: What is the outlook for audit premiums? - Management expects audit premiums to remain positive in 2025, despite potential deceleration in year-over-year comparisons [100][102] Question: Have competitors become more aggressive in the workers' comp market? - The market remains competitive, but AMERISAFE is prepared for competitors entering the high hazard space [104]

Financial Data and Key Metrics Changes - AMERISAFE reported net income of $13.2 million or $0.69 per diluted share for Q4 2024, down from $19.2 million or $1 per diluted share in Q4 2023 [13] - For the full year, net income was $55.4 million compared to $62.1 million in 2023, while net operating income decreased to $48.4 million from $55.9 million [14] - The combined ratio improved to 88.7% with a return on equity (ROE) of 20.2% [8][11] Business Line Data and Key Metrics Changes - Gross premiums written increased by 3.9% in Q4 and 3.1% for the full year, with voluntary premiums rising by 8.5% in Q4 and 4.6% for the year [6] - The enforced policy count grew by 9.6% for the year, indicating strong premium retention and new business production [6][7] Market Data and Key Metrics Changes - The accident year loss ratio remained steady at 71%, consistent with the prior year, with favorable development from prior accident years amounting to $9.7 million in Q4 and $34.9 million for the full year [10] - The investment portfolio's net investment income decreased by 14.4% to $6.9 million for Q4 and by 6.8% to $29.2 million for the full year [17] Company Strategy and Development Direction - The company is focused on top-line growth while maintaining consistent underwriting margins, emphasizing the importance of agent relationships and a sales-driven culture [6][8] - AMERISAFE aims to identify and ensure profitable high-risk, high-hazard risks to offset broader market challenges [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate a competitive landscape and maintain strong policy retention [11][79] - The outlook for the construction industry remains positive, with expectations of continued payroll growth and opportunities for business [74][79] Other Important Information - The Board of Directors approved a 5.4% increase in the regular dividend to $0.39 per share [11] - The company reported a book value per share of $13.51 after paying a special dividend, reflecting an 11.6% decrease from year-end 2023 [21] Q&A Session Summary Question: Can you provide context for the 9.6% policy count growth? - Management clarified that the 9.6% growth was for the entire year, with a 2.6% growth in the fourth quarter [24][28] Question: How has the average policy size trended? - The average policy size for 2024 was slightly lower than in 2023, with a noted decrease in average wages in Q4 [34] Question: What impact did renewal rates have on the top line? - Renewal rates were strong, with a policy retention rate of 94.1% on a policy basis and 88% on a premium basis [37] Question: How are claims from prior years developing? - Favorable development from prior accident years was noted, with significant contributions from 2022 and earlier years [39] Question: What is the outlook for the construction industry? - Management believes the construction industry remains strong, with payroll growth and opportunities for business despite potential economic challenges [74][79] Question: How many large claims were there in 2024? - The company reported 18 claims over a million dollars, which is consistent with the five-year average [81] Question: Any updates on medical inflation and reimbursement rates? - No significant changes were noted, but home health costs remain a focus due to their impact on larger claims [86] Question: What is the outlook for audit premiums? - Management expects audit premiums to remain positive in 2025, despite potential deceleration in year-over-year comparisons [102] Question: Have competitors become more aggressive in the workers' comp market? - The market remains competitive, but AMERISAFE is prepared to handle competitors entering the high hazard space [104]

Core Viewpoint - AMERISAFE, Inc. reported mixed financial results for the fourth quarter and full year of 2024, with adjusted earnings per share beating estimates but overall revenues and net income declining year over year [1][3]. Group 1: Fourth Quarter Performance - Adjusted EPS for Q4 was 67 cents, exceeding the Zacks Consensus Estimate by 11.7%, but down 9.5% from the previous year [1]. - Operating revenues decreased by 0.5% year over year to $73.5 million, missing the consensus mark by 4.9% [1]. - Net premiums earned rose by 1.2% year over year to $66.5 million but fell short of estimates by 4.6% [4]. - Net investment income dropped 14.4% year over year to $6.9 million due to reduced investable assets [4]. - Total expenses increased to $57.3 million in Q4, up from $56.2 million a year ago [5]. - The net combined ratio worsened by 60 basis points year over year to 86.1%, although it was better than the consensus estimate of 90.95% [5]. Group 2: Full-Year Performance - Full-year operating revenues were $300.1 million, slightly up from $299 million the previous year [3]. - Total expenses rose to $240 million from $229.5 million in the prior year [3]. - Operating earnings per share decreased to $2.53 from $2.91 year over year [3]. - Net income fell to $55.4 million from $62.1 million a year ago [3]. - Pre-tax underwriting profit declined by 18.6% year over year to $30.6 million [3]. Group 3: Financial Position - As of December 31, 2024, cash and cash equivalents increased to $44 million from $38.7 million at the end of 2023 [6]. - Total assets decreased to $1.16 billion from $1.23 billion at the end of 2023 [6]. - Shareholders' equity fell to $257.3 million from $292.5 million at the end of 2023 [6]. - Book value per share increased by 11.6% to $13.51 as of December 31, 2024 [6]. Group 4: Return on Equity and Capital Deployment - Return on average equity decreased by 590 basis points year over year to 18.5% in Q4 [7]. - A quarterly cash dividend of 39 cents per share was announced, reflecting a 5.4% increase, to be paid on March 21, 2025 [8].

Group 1 - Amerisafe reported quarterly earnings of $0.67 per share, exceeding the Zacks Consensus Estimate of $0.60 per share, but down from $0.74 per share a year ago, representing an earnings surprise of 11.67% [1] - The company posted revenues of $73.51 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 4.90%, compared to $73.88 million in the same quarter last year [2] - Over the last four quarters, Amerisafe has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] Group 2 - The stock's immediate price movement will depend on management's commentary on the earnings call and the sustainability of earnings expectations [3][4] - Amerisafe shares have underperformed the market, losing about 0.1% since the beginning of the year, while the S&P 500 gained 1.3% [3] - The current consensus EPS estimate for the coming quarter is $0.56 on revenues of $76.94 million, and for the current fiscal year, it is $2.18 on revenues of $314.81 million [7] Group 3 - The Zacks Industry Rank for Insurance - Accident and Health is currently in the top 32% of over 250 Zacks industries, indicating a favorable outlook for the industry [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5] - The current estimate revisions trend for Amerisafe is mixed, resulting in a Zacks Rank 3 (Hold) for the stock, suggesting it will perform in line with the market in the near future [6]

Financial Performance - AMERISAFE reported a net income of $55.4 million for the year 2024, with a return on equity of 20.2%[1][3]. - The company experienced a 31.2% decline in net income for Q4 2024 compared to Q4 2023, dropping to $13.2 million[3][8]. - Operating net income for the full year 2024 decreased by 13.5% to $48.4 million compared to 2023[3][8]. - Net income for Q4 2024 was $13,194,000, down from $19,181,000 in Q4 2023, reflecting a decrease of 31.1%[19]. - Basic earnings per share (EPS) for Q4 2024 was $0.69, compared to $1.00 in Q4 2023, a decline of 31.0%[19]. Premiums and Revenues - Net premiums earned increased by 1.3% year-over-year to $270.6 million for the full year 2024[3][4]. - Gross premiums written rose by 3.1% year-over-year to $294.1 million for the full year 2024[4][5]. - Gross premiums written for Q4 2024 were $62,702,000, an increase from $60,324,000 in Q4 2023, representing a growth of 2.3%[19]. - Total revenues for the twelve months ended December 31, 2024, were $309,043,000, slightly up from $306,853,000 in 2023, indicating a growth of 0.4%[19]. Investment Income - The company’s net investment income fell by 6.8% to $29.2 million for the full year 2024[6][7]. - Net investment income decreased to $6,914,000 in Q4 2024 from $8,077,000 in Q4 2023, a decline of 14.4%[19]. - The company reported net unrealized gains on equity securities of $9,508,000 for the twelve months ended December 31, 2024, compared to $1,228,000 in 2023, an increase of 676.5%[19]. Expenses and Ratios - The net combined ratio for the year was 88.7%, up from 85.9% in 2023, indicating increased underwriting costs[3][4]. - The underwriting expense ratio increased to 29.6% for the full year 2024, compared to 29.3% in 2023[5][4]. - Total expenses for the twelve months ended December 31, 2024, were $239,987,000, up from $229,476,000 in 2023, an increase of 4.6%[19]. Assets and Equity - The company's total assets decreased to $1,157,791,000 as of December 31, 2024, from $1,229,162,000 in 2023, a reduction of 5.8%[21]. - Reserves for loss and loss adjustment expenses were $651,309,000 as of December 31, 2024, down from $673,994,000 in 2023, a decrease of 3.4%[21]. - Shareholders' equity decreased to $257,341,000 as of December 31, 2024, from $292,451,000 in 2023, a decline of 12.0%[21]. Dividends and Tax - AMERISAFE's board of directors announced a 5.4% increase in the quarterly dividend, raising it from $0.37 to $0.39 per share[7][8]. - The effective tax rate for the full year 2024 remained unchanged at 19.7%[5][7].