W.R. Berkley Q4 Earnings Miss Estimate, Revenues Up Y/Y

Core Insights - W.R. Berkley Corporation's fourth-quarter 2025 operating income of $1.13 per share missed the Zacks Consensus Estimate by 0.9% and remained flat year over year [1] - The insurer experienced growth in premiums and revenues from non-insurance businesses, contributing positively to its overall performance [8] Financial Performance - Net premiums written were approximately $3 billion, reflecting a 2.1% year-over-year increase, but fell short of the Zacks Consensus Estimate of $3.2 billion [2] - Operating revenues reached $3.7 billion, up 5.9% year over year, driven by higher net premiums earned and improved net investment income, although it missed the consensus estimate by 0.9% [2] - Net investment income grew 6.6% to $338.2 million, driven by strong contributions from net unrealized gains on the equity portfolio, but was below the estimates of $362 million and $384 million [3] - Total expenses increased by 7.2% to $3.1 billion, primarily due to higher losses and operating costs, aligning closely with the estimate of $3.2 billion [3] Underwriting Metrics - The loss ratio decreased by 60 basis points to 61.2, while the expense ratio improved by 20 basis points year over year to 28.2 [4] - Catastrophe losses were $47.6 million, significantly lower than the $79.6 million incurred in the same quarter last year [4] - Pre-tax underwriting income increased by 14.9% to $338 million, while the consolidated combined ratio improved by 80 basis points year over year to 89.4, missing the Zacks Consensus Estimate of 90 [4] Segment Performance - In the Insurance segment, net premiums written increased by 1.7% year over year to $2.7 billion, but were lower than the estimate of $2.9 billion [5] - The combined ratio in the Insurance segment deteriorated by 10 basis points year over year to 90.6 [5] - The Reinsurance & Monoline Excess segment saw net premiums written increase by 5.4% year over year to $333.8 million, exceeding the estimate of $324.1 million [6] - The combined ratio in the Reinsurance & Monoline Excess segment deteriorated by 740 basis points to 81, matching the Zacks Consensus Estimate [6] Full-Year Highlights - For the full year, operating income was $4.33 per share, beating the Zacks Consensus Estimate by 1.6% and improving by 4.6% year over year [7] - Operating revenues for the year totaled $14.6 billion, up 7.8% year over year, in line with the consensus estimate [9] - Net investment income for the full year reached a record $1.4 billion, growing by 7.2% year over year [9] - Total net premiums written for the year were $12.7 billion, up 6.2% year over year, but below the Zacks estimate of $12.9 billion [10] Financial Update - W.R. Berkley ended 2025 with total assets of $44.1 billion, an increase from $40.6 billion a year ago [11] - Book value per share increased by 16.4% from the end of 2024 to $25.72 as of December 31, 2025 [11] - Cash flow from operations was $3.6 billion in 2025, down 2.6% year over year [11] - Operating return on equity declined by 120 basis points year over year to 20.6% [11] Capital Deployment - Total capital returned to shareholders was $970.5 million, which included $567.6 million in special dividends, $270.2 million in share repurchases, and $132.7 million in regular dividends [12]