RenaissanceRe Holdings Ltd. (RNR) reported third-quarter 2024 operating income of $10.23 per share, which surpassed the Zacks Consensus Estimate by 29.7%. The bottom line advanced 21.6% year over year.Total operating revenues soared 45.7% year over year to $3 billion. The top line beat the consensus mark by 3.7%.Its shares lost 4.4% on Thursday. Despite the earnings beat, the quarterly results were hurt by a rise in total expenses due to increased claims and acquisition costs, alongside a deterioration in c ...

Financial Data and Key Metrics - Operating income for Q3 2024 was $540 million, representing a 22% operating return on average common equity [5] - Year-to-date operating income reached $1.8 billion with a 26% operating return on equity [5] - Net income for Q3 2024 was $1.2 billion, with an annualized return on average common equity of 47% [22] - Underwriting income was $394 million with an adjusted combined ratio of 82% [23] - Retained net investment income was $292 million, up 35% year-over-year [23] - Tangible book value per share plus accumulated dividends increased by 30% since December 2023 [25] Business Line Performance - Property Catastrophe gross premiums written increased by 114% to $344 million, while net premiums written grew by 175% to $262 million [29] - Other Property gross premiums written rose by 28%, and net premiums written increased by 26% [32] - Casualty and Specialty net premiums written grew by 45% and 50%, respectively [35] - Fee income from Capital Partners business was $82 million, up 27%, with management fees at $55 million and performance fees at $27 million [39] Market Performance - The Property Catastrophe market remains disciplined with reinsurers holding on retentions and terms, despite increased demand for reinsurance [16] - U S cat limit purchases are estimated to increase by $10 billion in 2025, creating new opportunities [17] - Casualty lines are increasingly competitive, with the company engaging customers to provide feedback on rate and trend observations [21] Strategic Direction and Industry Competition - The acquisition of Validus has significantly contributed to growth across underwriting, investments, and Capital Partners business [8] - The company has successfully integrated Validus, unlocking $1 billion in capital and increasing financial flexibility [10][11] - The company is focusing on maintaining its book and seeking additional opportunities with existing customers in Specialty lines [18] - The Casualty business cycle is viewed over a 10-year scale, with the company advocating for accelerated rates to maintain attractiveness [20] Management Commentary on Operating Environment and Future Outlook - The company expects the Property market to remain attractive, with favorable rate environments in 2025 [17] - Management is optimistic about achieving additional rate increases in Casualty lines due to positive customer engagement [21] - The company anticipates continued strong returns in 2025, driven by its three profit drivers: underwriting, investments, and Capital Partners [5] Other Important Information - The company increased its share repurchase authorization from $500 million to $750 million, reflecting its larger scale and capital flexibility [14] - Hurricane Milton is estimated to have a net negative impact of $275 million in Q4 2024, based on an industry loss estimate of $25 billion [34] - The Bermuda Government will implement a 15% corporate income tax in 2025, with the company starting to accrue for this tax in Q1 2025 [45] Q&A Session Summary Question: Impact of excess capital on 1 1 renewals and potential rate declines [72] - The company believes the additional $10 billion in new capacity will stabilize the pricing environment, with rates remaining fair and adequate [72] Question: Casualty Specialty combined ratio and reserve adjustments [73] - The company is increasing the combined ratio to mid-to-upper 90s in 2025, reflecting forward-looking trends and current accident year adjustments [74][75] Question: Loss trend issues and prior year reserves [80] - The company's reserving process is independent of client bookings, with a focus on maintaining resilient reserves through prudent underwriting and portfolio construction [81] Question: Share repurchase authorization increase [82] - The increase reflects the company's larger scale and the completion of Validus integration, providing greater capital flexibility [83][84] Question: Equity capital needs and excess capital [86] - The company manages with a degree of undeployed capital for flexibility, expecting opportunities to deploy capital in 2025 while returning excess to shareholders [86] Question: Impact of European losses on 1 1 renewals [87] - Loss activity in Europe and North America is expected to stabilize retentions and structures, with price discussions centered around current levels [87] Question: Adequacy of share repurchase authorization [91] - The company evaluates share repurchase opportunities quarterly, with the ability to deploy capital into the business and return excess to shareholders [94] Question: Special dividends as a capital return mechanism [95] - The company prefers share buybacks due to their accretive nature to tangible book value per share, with no immediate plans for special dividends [95] Question: Casualty and Specialty reserve movement by accident year [96] - Purchase accounting adjustments affected prior year reserves by approximately $10 million, with the company maintaining a balanced portfolio in better years [96][97] Question: Shifting focus to excess of loss in Casualty lines [98] - The company emphasizes quota share structures for alignment with clients, with seeding commissions reducing and benefiting net positions [98][99] Question: Casualty Specialty guidance and rate assumptions [102] - The company has priced in additional loss trend and rate increases for 2025, reflecting market responses to accelerating loss trends [103] Question: Retrocapacity availability in 2025 [107] - The company expects stable retrocapacity in 2025, with plans to purchase slightly less retro to shape its portfolio [107] Question: Casualty loss ratio improvement assumptions [110] - The company sets initial loss picks independently and adjusts curves slowly, reflecting cautious reserving practices and a focus on margin enhancement [110][112] Question: Engagement with Casualty seeding and reserve adjustments [114] - The company has engaged early with brokers and clients to gather data on trends, claim settlement practices, and underwriting adjustments for 2025 pricing [114][115]

Financial Performance - Net income attributable to RenaissanceRe common shareholders for the three months ended September 30, 2024, was $1,173,644, compared to $193,988 for the same period in 2023, reflecting a significant increase of 505.5%[14]. - Total revenues for the nine months ended September 30, 2024, reached $9,401,720, up from $5,894,318 in the same period of 2023, marking a growth of 59.8%[14]. - Net income for the nine months ended September 30, 2024, was $2,979,753, compared to $1,631,592 for the same period in 2023, representing an increase of approximately 82.5%[17]. - Comprehensive income for the three months ended September 30, 2024, was $1,633,045, compared to $416,070 for the same period in 2023, showing an increase of 292.5%[15]. - Net income available to RenaissanceRe common shareholders was $2.0 billion for the nine months ended September 30, 2024, compared to $949.1 million in the same period of 2023[249]. Premiums and Underwriting - Gross premiums written for the three months ended September 30, 2024, increased to $2,400,136 from $1,618,443 for the same period in 2023, representing a growth of 48.3%[14]. - For the three months ended September 30, 2024, the Company reported direct premiums written of $288.9 million, an increase from $222.4 million for the same period in 2023, representing a growth of 29.8%[81]. - Assumed premiums written for the nine months ended September 30, 2024, reached $8.9 billion, up from $6.4 billion in the prior year, indicating a growth of 39.4%[81]. - The combined ratio for the three months ended September 30, 2024, improved to 84.8%, compared to 100.1% in the previous period, indicating better underwriting performance[148]. - The net claims and claim expense ratio for the current accident year was 64.5%, showing a decrease from 65.8% in the previous period[148]. Investments - Total investments increased to $33,033,677 as of September 30, 2024, up from $29,216,143 at December 31, 2023, representing a growth of approximately 9.3%[13]. - The investment in equity investments at fair value rose to $133,091 from $106,766, representing an increase of about 24.5%[13]. - Net investment income for the three months ended September 30, 2024, was $423,859, compared to $329,108 for the same period in 2023, an increase of 28.7%[14]. - Total fixed maturity investments trading reached $24,287,185 as of September 30, 2024, up from $20,877,108 at the end of 2023, indicating an increase of approximately 16.5%[23]. - Net realized and unrealized gains on investments totaled $943,745 million for the nine months ended September 30, 2024, compared to a loss of $228,087 million for the same period in 2023[31]. Claims and Expenses - Net claims and claim expenses incurred for the nine months ended September 30, 2024, totaled $3,849,239, compared to $2,593,987 for the same period in 2023, reflecting a rise of 48.5%[14]. - The gross claims and claim expenses incurred for the nine months ended September 30, 2024, totaled $4.07 billion, compared to $2.84 billion in the same period of 2023, marking an increase of 43.3%[81]. - The total reserve for claims and claim expenses as of September 30, 2024, was $21.22 billion, an increase from $15.96 billion at the end of the previous year, reflecting a growth of 33.1%[88]. - The net incurred claims for the current year were $4.35 billion for the nine months ended September 30, 2024, compared to $2.89 billion for the same period in 2023, representing an increase of 50.7%[88]. - The net claims and claim expense ratio for the current accident year was 57.4% for the nine months ended September 30, 2024, compared to 55.3% in the previous year[249]. Shareholder Equity and Dividends - Shareholders' equity attributable to RenaissanceRe grew to $11,242,584, up from $9,454,958, marking an increase of around 18.9%[13]. - The ending balance of total shareholders' equity as of September 30, 2024, was $11,242,584, compared to $7,588,617 as of September 30, 2023, representing an increase of 48.2%[16]. - The Company paid $60.9 million in common share dividends during the nine months ended September 30, 2024, compared to $55.2 million in the same period of 2023[141]. - The average price per common share repurchased was $223.59, with $476.5 million remaining available for repurchase under the program as of September 30, 2024[142]. - Basic earnings per common share for the three months ended September 30, 2024, was $22.68, significantly higher than $3.81 for the same period in 2023[144]. Debt and Liabilities - Total liabilities increased to $34,652,827 from $33,451,316, reflecting a growth of approximately 3.6%[13]. - The total debt obligations as of September 30, 2024, amounted to $1,929.8 million, with senior notes totaling $1,879.8 million[99]. - The company believes it was in compliance with its debt covenants as of September 30, 2024[98]. - The company reported a net cash used in financing activities of $(911,495) for the nine months ended September 30, 2024, compared to a net cash provided of $2,104,136 in the same period of 2023[17]. - The company had debt obligations of $1.9 billion as of September 30, 2024, unchanged from the fair value reported at December 31, 2023[70].

Core Insights - RenaissanceRe reported $3.01 billion in revenue for Q3 2024, a 45.7% year-over-year increase, with an EPS of $10.23 compared to $8.33 a year ago, exceeding both revenue and EPS consensus estimates [1][3] Financial Performance Metrics - Net Claims and Claim Expense Ratio stood at 53.2%, significantly better than the 61.1% average estimate from four analysts [3] - Underwriting Expense Ratio was reported at 31.6%, slightly above the 30.1% average estimate from four analysts [3] - Combined Ratio was 84.8%, outperforming the 91.2% average estimate from four analysts [3] - Net premiums earned reached $2.58 billion, exceeding the four-analyst average estimate of $2.48 billion, reflecting a year-over-year increase of 47.1% [3] - Net investment income was $423.86 million, surpassing the $416.60 million estimate, marking a 28.8% year-over-year increase [3] - Net premiums earned in the Property segment were $994.78 million, above the three-analyst average estimate of $938.74 million, with a year-over-year change of 30.8% [3] - Net premiums earned in the Casualty and Specialty segment were $1.59 billion, exceeding the three-analyst average estimate of $1.53 billion, showing a year-over-year increase of 59.5% [3] Stock Performance - RenaissanceRe shares have returned +3% over the past month, outperforming the Zacks S&P 500 composite's +0.7% change, with a current Zacks Rank of 3 (Hold) indicating potential performance in line with the broader market [4]

分组1 - RenaissanceRe reported quarterly earnings of $10.23 per share, exceeding the Zacks Consensus Estimate of $7.89 per share, and up from $8.33 per share a year ago, representing an earnings surprise of 29.66% [1] - The company achieved revenues of $3.01 billion for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 3.68%, compared to $2.06 billion in the same quarter last year [2] - RenaissanceRe has consistently outperformed consensus EPS and revenue estimates over the last four quarters [2] 分组2 - The stock has increased approximately 37.4% since the beginning of the year, outperforming the S&P 500's gain of 21.2% [3] - The current consensus EPS estimate for the upcoming quarter is $9.27, with expected revenues of $2.92 billion, and for the current fiscal year, the EPS estimate is $39.96 on revenues of $11.6 billion [7] - The Zacks Industry Rank for Insurance - Property and Casualty is in the top 20% of over 250 Zacks industries, indicating a favorable outlook for the sector [8]

Core Insights - RenaissanceRe (RNR) has consistently surpassed earnings estimates, averaging a beat of 18.80% over the last two quarters [1] - The most recent earnings report showed a surprise of 14.06%, with earnings per share (EPS) of $12.41 compared to an estimate of $10.88 [1] - In the previous quarter, RenaissanceRe reported an EPS of $12.18 against an estimate of $9.86, resulting in a surprise of 23.53% [1] Earnings Estimates and Predictions - Estimates for RenaissanceRe have been trending higher, supported by its history of earnings surprises [2] - The stock has a positive Zacks Earnings ESP of +7.56%, indicating bullish sentiment among analysts regarding its near-term earnings potential [3] - The combination of a positive Earnings ESP and a Zacks Rank of 3 (Hold) suggests a high likelihood of another earnings beat, with the next report expected on November 6, 2024 [3] Importance of Earnings ESP - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, reflecting the latest analyst revisions [3] - A negative Earnings ESP can reduce predictive power but does not necessarily indicate an earnings miss [3] - Utilizing the Earnings ESP Filter can help identify stocks with the best potential for success ahead of quarterly releases [4]

Core Viewpoint - RenaissanceRe's shares experienced a 3% increase, attributed to higher trading volume and strong performance in its Property and Casualty & Specialty segments, despite a 1.9% loss over the past four weeks [1][2]. Group 1: Financial Performance - Overall net premiums earned by RenaissanceRe improved by 43.8% year over year in the first half of 2024, driven by market dislocation, rate increases, and higher reinsurance demand, particularly in Florida [2]. - The company is expected to report quarterly earnings of $4.60 per share, reflecting a year-over-year decline of 44.8%, while revenues are anticipated to reach $2.84 billion, marking a 37.7% increase from the previous year [4]. Group 2: Strategic Positioning - Strategic acquisitions, such as Validus Re, are enhancing RenaissanceRe's global scale and profitability, while divestitures are streamlining operations [3]. - The company maintains a strong cash balance, positioning it well for growth and shareholder returns, with a history of increasing dividends for 29 consecutive years [3]. Group 3: Market Sentiment and Estimates - The consensus EPS estimate for RenaissanceRe has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [5]. - RenaissanceRe currently holds a Zacks Rank of 3 (Hold), indicating a neutral outlook in the market [5].

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Leading insurer RenaissanceRe Holdings Ltd. (RNR) has seen impressive gains in 2024, with shares jumping 39%, outpacing the industry's 28.1% growth and the S&P 500's 20.6% rise. It also outpaced its peers like Everest Group, Ltd. (EG) and Chubb Limited (CB) . This rally has boosted RenaissanceRe's market capitalization by $3.92 billion in 2024 alone. With this sharp rally, the question for investors is whether to ride the momentum for more potential upside or lock in profits. A deeper look at RNR's future p ...

Company Performance - RenaissanceRe (RNR) shares have increased by 4.5% over the past month, reaching a new 52-week high of $269.61, and have gained 37.3% since the start of the year, outperforming the Zacks Finance sector (17.3%) and the Zacks Insurance - Property and Casualty industry (27.1%) [1] - The company has a strong record of positive earnings surprises, having beaten earnings consensus estimates in the last four quarters, with the latest EPS reported at $12.41 against a consensus estimate of $10.88 [2] Financial Projections - For the current fiscal year, RenaissanceRe is expected to post earnings of $39.01 per share on revenues of $11.51 billion, reflecting a 3.92% change in EPS and a 32.25% change in revenues [3] - For the next fiscal year, earnings are projected to be $35.46 per share on revenues of $11.81 billion, indicating a year-over-year change of -9.11% in EPS and 2.59% in revenues [3] Valuation Metrics - RenaissanceRe has a Value Score of B, with Growth and Momentum Scores of C and D, respectively, resulting in a combined VGM Score of B [6] - The stock trades at 6.9X current fiscal year EPS estimates, below the peer industry average of 13.7X, and at 8.2X trailing cash flow compared to the peer group's average of 13.1X [7] Zacks Rank - RenaissanceRe holds a Zacks Rank of 2 (Buy), supported by favorable earnings estimate revisions from analysts [8] - The company meets the criteria for selection based on Zacks Rank and Style Scores, indicating potential for future performance [9] Industry Context - The Insurance - Property and Casualty industry is positioned in the top 8% of all industries, suggesting favorable conditions for both RenaissanceRe and its peers [12]