Chubb (CB) Up 2.4% Since Last Earnings Report: Can It Continue?

Core Viewpoint - Chubb Limited reported strong third-quarter earnings, surpassing expectations, driven by solid performance across various segments, although some areas faced challenges due to higher catastrophe losses [2][4][11]. Financial Performance - Core operating income for Q3 2024 was $5.72 per share, exceeding the Zacks Consensus Estimate by 16% and reflecting a year-over-year increase of 15.6% [2]. - Net premiums written rose 5.5% year over year to $13.8 billion, although it fell short of the consensus estimate of $14.3 billion [3]. - Total revenues reached $15 billion, a 6.5% year-over-year improvement, but missed the consensus estimate by 1.5% [3]. Underwriting and Investment Income - Property and casualty (P&C) underwriting income was $1.4 billion, up 11.7% year over year, surpassing the Zacks Consensus Estimate of $1.1 billion [4]. - Pre-tax net investment income increased by 14.7% year over year to $1.5 billion, matching estimates [3]. Segment Performance - North America Commercial P&C Insurance saw net premiums written increase by 7.2% to $5.5 billion, with a combined ratio of 86.5% [6]. - North America Personal P&C Insurance net premiums written climbed 10% to $1.6 billion, with a combined ratio improving to 81.3% [7]. - Overseas General Insurance net premiums written rose 4.9% to $3.3 billion, with a combined ratio of 86% [9]. - Life Insurance segment net premiums written increased by 6.8% to $1.6 billion, although it was below the estimate of $2 billion [10]. Financial Health - As of September 30, 2024, Chubb's cash balance was $2.6 billion, a 2.1% increase from the end of 2023, and total shareholders' equity grew 10% to $70.1 billion [11]. - Book value per share increased by 11.1% to $163.16 [11]. - Core operating return on tangible equity expanded by 50 basis points year over year to 21.7% [12]. Capital Deployment - In the quarter, Chubb repurchased shares worth $413 million and paid $369 million in dividends [13]. Market Outlook - Recent estimates for Chubb have trended downward, with a consensus estimate shift of -5% [14][15]. - The stock currently holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [17]. Industry Comparison - Chubb operates within the Zacks Insurance - Property and Casualty industry, where RLI Corp. reported a 21.6% year-over-year revenue increase, highlighting competitive performance within the sector [18].