Core Insights - Renaissance Investment Management's Q3 2025 "International Small Cap Equity Strategy" investor letter indicates a positive trend in international equities, marking the third consecutive quarter of gains and heading towards the best year since 2017 [1] - The portfolio outperformed its benchmark during the quarter, showcasing strong relative returns [1] Company Summary: Fidelis Insurance Holdings Limited (NYSE:FIHL) - Fidelis Insurance Holdings Limited experienced a one-month return of -3.61% and a 52-week loss of 5.48%, with its stock closing at $18.60 per share and a market capitalization of $1.95 billion as of December 09, 2025 [2] - The company was sold by Renaissance during the quarter due to anticipated growth challenges from industry-wide pricing pressures and lower interest rates affecting investment income [3] - Despite its potential, Fidelis Insurance Holdings Limited is not among the 30 most popular stocks among hedge funds, with 16 hedge fund portfolios holding the stock at the end of Q3 2025, down from 20 in the previous quarter [3]

Core Insights - Fidelis Insurance Holdings Limited (NYSE:FIHL) is recognized as one of the 14 Best Up and Coming Dividend Stocks to Buy [1] - Goldman Sachs raised its price target for FIHL to $17 from $16.50 while maintaining a Sell rating after reviewing the company's third-quarter results [2] Financial Performance - For Q3 2025, FIHL reported revenue of $652 million, a 5% decline year-over-year, and approximately $25 million below analyst expectations [3] - Gross premiums written increased to $797.5 million, reflecting a 7.5% growth compared to Q3 2024 [3] - The combined ratio improved to 79.0%, down from 87.4% a year ago, indicating better operational efficiency [3] - Net income was reported at $130.5 million, or $1.24 per diluted share, while operating net income was $126.8 million, or $1.21 per diluted share [3] Capital Return and Outlook - The company returned $47.3 million to investors in the quarter, comprising $31.9 million in share repurchases and $15.4 million in dividends [4] - Management reaffirmed its outlook for full-year top-line growth of 6% to 10%, expressing confidence in maintaining profitable momentum [4] Company Overview - FIHL operates as a global specialty insurer and reinsurer, focusing on value creation through disciplined capital deployment, selective underwriting, and long-term partnerships [5]

Financial Data and Key Metrics Changes - The company reported an operating net income of $127 million, or $1.21 per diluted common share, with an annualized operating return on average equity (ROAE) of 21.4%, an increase of five points year over year [13][14] - The combined ratio for the quarter was 79%, the best since becoming a publicly traded company, improving by more than eight percentage points from the same quarter last year [5][16] - Gross premiums written increased by 8% to $798 million for the quarter, bringing year-to-date gross premiums written to $3.7 billion, also an increase of 8% compared to the same period last year [14][15] Performance Across Business Lines - In the insurance segment, gross premiums written increased by 4% to $606 million, driven by new business and asset-backed finance [14][15] - The reinsurance segment saw gross premiums written grow to $192 million for the quarter, up from $159 million in the prior year, attributed to new business opportunities following loss impacts from California wildfires [15][11] - The direct property book grew by 9.5% year on year, benefiting from new opportunities at compelling pricing [8][14] Market Data and Key Metrics Changes - The company experienced a positive pricing dynamic in the reinsurance segment, with an RPI of 7.1, supported by post-wildfire opportunities [11][12] - The overall RPI remained broadly flat, reflecting the company's differentiated position and ability to navigate market conditions [8][9] - The effective tax rate for the first nine months of the year was 18.8%, compared to 14.6% in the same period of 2024, reflecting a greater proportion of pre-tax income generated in higher tax rate jurisdictions [19] Company Strategy and Development Direction - The company is focused on strategic capital allocation and expert risk selection, balancing profitable growth with returning capital to shareholders through share repurchases and dividends [6][20] - The ongoing expansion of underwriting partnerships is a strategic priority, with the total number of underwriting partners growing to the mid-single digits [23][24] - The company aims to maintain discipline in underwriting standards while capitalizing on attractive rate and margin opportunities across various lines of business [25][27] Management's Comments on Operating Environment and Future Outlook - Management remains bullish about the market, indicating that the prevailing hard market conditions present opportunities for growth [33][34] - The company is cautious in the aviation sector due to increased competition and has seen encouraging signs in the marine sector [10][79] - Management emphasized the importance of maintaining underwriting discipline and focusing on margin, even as competition increases [27][76] Other Important Information - The company repurchased 1.8 million common shares for $32 million at an average price of $17.40 per share during the quarter, with additional repurchases following [21][22] - The average rating of fixed income securities remains high at A-plus, with a book yield of 5% [19] Q&A Session Summary Question: Thoughts on reinsurance growth and expectations for 2026 - Management expressed confidence in the market, indicating that they expect to continue seeing growth opportunities through both existing and new underwriting partnerships [33][34] Question: Stability of RPIs and competitive pressures - Management acknowledged pressure in certain lines, particularly in direct property, but noted strong retention rates and margins [37][38] Question: Exposure to Caribbean hurricane losses - Management indicated that while there is some exposure, it is too early to provide detailed loss estimates, but any net losses are expected to fall within the anticipated cap load [59] Question: Opportunities in data center construction - Management highlighted the importance of having a meaningful line size to participate in large placements, leveraging their structure with the Fidelis partnership [60][62] Question: Verticalization in the market - Management clarified that verticalization is a phenomenon present in both hard and soft markets, allowing them to set terms and conditions effectively [45][46] Question: Concerns about valuation and market multiples - Management agreed that they believe the company is undervalued and emphasized the need for consistent strong underwriting results to unlock value [52][54] Question: Performance in aviation and marine sectors - Management noted that while aviation remains competitive, marine is showing more stability and opportunities for growth [76][79]

Financial Data and Key Metrics Changes - The company reported a combined ratio of 79%, marking an improvement of over eight points year-over-year, which is the best performance since going public [5][16] - Annualized operating return on average equity (ROAE) increased to 21.4%, up five points from the previous year [5][14] - Diluted book value per share grew by $1.25 during the quarter, reaching $23.29, an increase of 8.3% since year-end [14][19] Business Line Data and Key Metrics Changes - Gross premiums written increased by 8% to $798 million for the quarter, with year-to-date gross premiums also up 8% to $3.7 billion [14] - In the insurance segment, gross premiums written rose by 4% to $606 million, driven by new business and asset-backed finance [14][15] - The reinsurance segment saw gross premiums written grow to $192 million, a 20% increase year-over-year, attributed to new business opportunities and enhanced pricing [11][15] Market Data and Key Metrics Changes - The company experienced strong performance in property and asset-backed finance, with the direct property book growing by 9.5% year-over-year [8][14] - The reinsurance segment's RPI was positive, supported by double-digit increases in the U.S. book, driven by post-loss pricing [11][12] - The overall RPI remained broadly flat, reflecting the company's differentiated position and ability to navigate market conditions [8][9] Company Strategy and Development Direction - The company is focused on strategic capital allocation and expert risk selection, balancing profitable growth with returning capital to shareholders [6][20] - There is an ongoing emphasis on expanding underwriting partnerships, with the total number of partners growing to the mid-single digits [23][24] - The company aims to maintain a disciplined approach to underwriting, even as competition increases in certain lines [25][27] Management's Comments on Operating Environment and Future Outlook - Management remains bullish about the market, indicating that the current hard market conditions present opportunities for growth [33] - The company is confident in its ability to deliver compelling underwriting margins across segments, despite potential pricing pressures [27][29] - Management highlighted the importance of maintaining underwriting discipline and leveraging strong relationships with brokers and clients [39][81] Other Important Information - The company repurchased 1.8 million common shares for $32 million at an average price of $17.40 per share during the quarter [21] - The effective tax rate for the first nine months of the year was 18.8%, reflecting a greater proportion of income generated in higher tax jurisdictions [19] Q&A Session Summary Question: Thoughts on reinsurance growth and expectations for 2026 - Management expressed confidence in the prevailing hard market and the potential for continued growth through partnerships and a strong pipeline of opportunities [33][34] Question: Stability of RPIs and competitive pressures - Management acknowledged pressure in certain lines, particularly in property, but emphasized strong retention rates and margins [37][38] Question: Direct property book growth and potential tailwinds - Management noted that new homeowners business contributed to growth and highlighted opportunities in data center construction [40][41] Question: Verticalization and market dynamics - Management clarified that verticalization is present in both hard and soft markets, allowing the company to set terms and conditions effectively [45][46] Question: Exposure to Caribbean hurricane losses - Management indicated some exposure but expected any net losses to fall within expected limits [59] Question: Partnerships and capabilities for data center construction - Management discussed the importance of having a meaningful line size and leveraging partnerships to negotiate favorable terms [60][62] Question: Update on aviation and marine lines - Management noted improvements in aviation pricing but maintained caution due to competition, while expressing comfort with marine opportunities [76][81]

Financial Data and Key Metrics Changes - The company reported an operating net income of $127 million, or $1.21 per diluted common share, resulting in an annualized operating return on average equity (ROAE) of 21.4%, an increase of five points year over year [11][12] - The combined ratio for the quarter was 79%, the best as a publicly traded company, and an improvement of more than eight points from the same quarter last year [4][13] - The diluted book value per share grew by $1.25 in the quarter, reaching $23.29, which is an increase of 8.3% since year-end [11][12] Business Line Data and Key Metrics Changes - Gross premiums written increased by 8% to $798 million for the quarter, with year-to-date gross premiums written at $3.7 billion, also an increase of 8% compared to the same period last year [11][12] - In the insurance segment, gross premiums written grew by 4% to $606 million, while the reinsurance segment saw gross premiums written increase to $192 million from $159 million in the prior year period, driven by new business opportunities [11][12] - The direct property book grew by 9.5% year on year, supported by new opportunities at compelling pricing [6][12] Market Data and Key Metrics Changes - The company experienced strong performance in the property and asset-backed finance sectors, with overall RPI remaining broadly flat, reflecting the differentiated position and product diversification [6][7] - The reinsurance segment delivered 20% year-on-year premium growth, driven by enhanced pricing at 7.1, particularly benefiting from post-wildfire opportunities [9][12] Company Strategy and Development Direction - The company is focused on driving profitable growth through strategic capital allocation and expert risk selection, balancing profitable growth with returning capital to shareholders [5][17] - The ongoing expansion of underwriting partnerships is a strategic priority, with the total number of underwriting partners growing to the mid-single digits [19][20] - The company aims to maintain a disciplined approach to underwriting, even as competition increases in certain lines, ensuring attractive margins and risk-reward dynamics [22][24] Management's Comments on Operating Environment and Future Outlook - Management remains bullish about the market, indicating that the company is in a prevailing hard market with opportunities for growth [29][30] - The company is cautious in the aviation sector, which remains highly competitive, while expressing confidence in the marine sector due to stable pricing and new business opportunities [64][68] - Management emphasized the importance of maintaining underwriting discipline and leveraging strong relationships with brokers and clients to capitalize on market opportunities [70][72] Other Important Information - The company repurchased 1.8 million common shares for $32 million at an average price of $17.40 per share during the quarter, with additional repurchases following [17][18] - The effective tax rate for the first nine months of the year was 18.8%, reflecting a greater proportion of pre-tax income generated in higher tax rate jurisdictions [16] Q&A Session Summary Question: Thoughts on reinsurance growth and expectations for 2026 - Management remains optimistic about the market, indicating that they expect to continue seeing growth opportunities across their portfolio, particularly through new underwriting partners [29][30] Question: Stability of RPIs and competitive pressures - Management acknowledged that while there is pressure in certain lines, they are able to maintain strong retention rates and margins, leveraging their leadership position [32][33] Question: Exposure to Caribbean hurricane losses - Management indicated that while there is some exposure, it is too early to provide detailed numbers, but they expect any net losses to fall within their expected cap load [51] Question: Partnerships and capabilities in data center construction - Management highlighted their ability to deploy meaningful line sizes through their partnership structure, allowing them to negotiate favorable terms and conditions [52][53] Question: Valuation concerns and market multiples - Management agreed that they believe the company is undervalued relative to peers and emphasized the importance of consistent strong underwriting results to unlock value [46][47]

Financial Performance - The company's Q3 2025 combined ratio was 790%, the best as a publicly traded company to date[14] - The annualized Operating ROAE was 214% for Q3 2025[14, 15] - Book value per diluted common share grew to $2329[14, 19] - Gross premiums written for the trailing twelve months ended September 30, 2025 were $47 billion[7, 8] Growth and Premiums - Gross premiums written grew by 8% in Q3 2025 compared to Q3 2024, reaching $798 million[15, 18] - Year-to-date gross premiums written increased by 8% or $290 million, totaling $3739 million[19, 20] - Insurance gross premiums written increased by 6% year-to-date, reaching $2775 million[23, 25] - Reinsurance gross premiums written increased by 16% year-to-date[27, 30] Capital Management - The company returned $180 million of capital to common shareholders in the nine months ended September 30, 2025, including $143 million in share repurchases and $37 million in dividends[20] - The company has $1531 million remaining for share repurchase authorization[37] Investment Portfolio - Net investment income for Q3 2025 was $46 million, bringing the year-to-date total to $140 million[15, 36]

Core Insights - Fidelis Insurance Holdings reported quarterly earnings of $1.21 per share, missing the Zacks Consensus Estimate of $1.6 per share, but showing an increase from $0.92 per share a year ago, resulting in an earnings surprise of -24.38% [1] - The company posted revenues of $645.7 million for the quarter ended September 2025, which was 14.88% below the Zacks Consensus Estimate and a decrease from $686.6 million year-over-year [2] - Fidelis Insurance has surpassed consensus EPS estimates three times over the last four quarters, but has not beaten consensus revenue estimates during the same period [2] Future Outlook - The immediate price movement of Fidelis Insurance shares will largely depend on management's commentary during the earnings call and the company's earnings outlook [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.93 on revenues of $730.68 million, and for the current fiscal year, it is $2.17 on revenues of $2.72 billion [7] - The Zacks Rank for Fidelis Insurance is currently 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Industry Context - The Insurance - Multi line industry, to which Fidelis Insurance belongs, is currently ranked in the top 22% 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]

Core Viewpoint - Fidelis Insurance Holdings (FIHL) is anticipated to report a year-over-year increase in earnings driven by higher revenues for the quarter ended September 2025, with the actual results being a significant factor influencing its near-term stock price [1][2]. Earnings Expectations - The upcoming earnings report is expected to reveal quarterly earnings of $1.60 per share, reflecting a year-over-year increase of +73.9%, with revenues projected at $758.54 million, up 10.5% from the previous year [3]. - The stock may experience upward movement if these key figures exceed expectations, while a miss could lead to a decline [2]. Estimate Revisions - The consensus EPS estimate has been revised down by 8.37% over the last 30 days, indicating a reassessment by analysts [4]. - The Most Accurate Estimate for Fidelis Insurance aligns with the Zacks Consensus Estimate, resulting in an Earnings ESP of 0%, suggesting no recent differing analyst views [12]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive or negative reading can predict deviations from consensus estimates, with a positive ESP being a strong indicator of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [9][10]. - Fidelis Insurance currently holds a Zacks Rank of 3, making it challenging to predict an earnings beat conclusively [12]. Historical Performance - In the last reported quarter, Fidelis Insurance was expected to post a loss of $0.12 per share but instead delivered earnings of $0.12, resulting in a surprise of +200.00% [13]. - Over the past four quarters, the company has consistently beaten consensus EPS estimates [14]. Conclusion - While the potential for an earnings beat exists, other factors may influence stock movement, and the company does not currently appear to be a compelling earnings-beat candidate [15][17].

Core Viewpoint - Fidelis Insurance Group has declared a quarterly dividend of $0.15 per common share, payable on December 23, 2025, to shareholders of record on December 10, 2025 [1]. Company Overview - Fidelis Insurance Group is a global specialty insurer that leverages strategic partnerships to provide innovative and tailored insurance solutions [2]. - The company maintains a highly diversified portfolio, allowing it to capitalize on opportunities in evolving (re)insurance markets and to produce superior underwriting returns [2]. Financial Strength Ratings - Fidelis Insurance Group has received strong financial strength ratings: A from AM Best, A- from S&P, and A3 from Moody's [3]. Capital Management Initiatives - The company has expanded its capital management initiatives, renewing its common share repurchase authorization to $200 million and increasing the quarterly dividend to $0.15 per common share [8].

Group 1 - Fidelis Insurance Holdings Limited (NYSE:FIHL) is considered one of the most undervalued small-cap stocks currently available for investment [1] - Barclays raised the price target for Fidelis Insurance Holdings Limited to $19 from $17 while maintaining an Equal Weight rating [1] - Keefe Bruyette increased the price target for Fidelis Insurance Holdings Limited to $24 from $22, keeping an Outperform rating [2] - Evercore ISI also updated its price target for Fidelis Insurance Holdings Limited to $19 from $18 while maintaining an In Line rating [3] Group 2 - Fidelis Insurance Holdings Limited operates as a global specialty insurer, focusing on tailored and innovative insurance solutions through strategic partnerships [4] - The company's operations are divided into two main segments: Insurance and Reinsurance [4]