Why Is Axis Capital (AXS) Up 0.5% Since Last Earnings Report?

Core Viewpoint - Axis Capital reported strong fourth-quarter earnings growth driven by higher net premiums and investment gains, despite increased expenses [2][4]. Financial Performance - The company achieved fourth-quarter operating income of $3.25 per share, exceeding the Zacks Consensus Estimate by 9.4% and reflecting a year-over-year increase of 9.4% [2]. - Total operating revenues reached $1.7 billion, surpassing the Zacks Consensus Estimate by 5.2% and increasing nearly 9% year over year [3]. - Net premiums written rose 13% to $1.4 billion, with a 14% increase in the Insurance segment and 5% growth in the Reinsurance segment [3]. Investment Income and Expenses - Net investment income decreased by 4.5% year over year to $187 million, falling short of the Zacks Consensus Estimate of $198 million [4]. - Total expenses increased by 16.6% year over year to $1.4 billion, driven by higher net losses, acquisition costs, and administrative expenses [4]. Underwriting Performance - Pre-tax catastrophe losses amounted to $30 million, including $17 million from Hurricane Melissa [5]. - Underwriting income increased by 42% year over year to $184 million, with the combined ratio improving to 90.4 from 94.2 a year ago [5]. Segment Results - In the Insurance segment, gross premiums written improved by 11.7% year over year to $1.9 billion, with underwriting income rising 74.2% to $157.6 million [6]. - In the Reinsurance segment, gross premiums written increased by 13% year over year to $310.7 million, while underwriting income decreased by 31.9% to $26.6 million [7]. Full-Year Highlights - For the full year 2025, operating income was reported at $12.92 per share, exceeding the Zacks Consensus Estimate by 1.9% and reflecting a 15.6% year-over-year increase [8]. - Total operating revenues for the year reached $6.5 billion, beating the Zacks Consensus Estimate by 1.2% and increasing by 6.7% year over year [8]. Financial Position - At the end of the fourth quarter, cash and cash equivalents stood at $820.3 million, down 61.7% from the previous year [10]. - Debt was reported at $1.3 billion, a slight increase of 0.1% from the previous year [10]. - Book value per diluted common share increased by 18.3% to $77.20 [10]. Capital Deployment - The company repurchased $888 million of common shares in 2025 and declared a quarterly cash dividend of 44 cents per share, totaling $139 million in annual dividends [11]. Market Outlook - Estimates for Axis Capital have been trending upward, with a consensus estimate shift of 7.92% [12]. - The company holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [14]. Industry Comparison - Axis Capital is part of the Zacks Insurance - Property and Casualty industry, with competitor W.R. Berkley reporting a revenue increase of 5.9% year over year [15].