The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how reinsurance stocks fared in Q2, starting with Fidelis Insurance (NYSE:FIHL).
This is a cyclical industry, and the sector benefits when there is 'hard market', characterized by strong premium rate increases that outpace loss and cost inflation, resulting in robust underwriting margins. The opposite is true in a 'soft market'. Interest rates also matter, as they determine the yields earned on fixed-income portfolios. The primary headwind remains the immense and concentrated exposure to large-scale catastrophe losses, as the growing impact of climate change challenges traditional risk models and creates significant earnings volatility. Additionally, they face the risk of adverse prior-year reserve development, where claims prove more costly than anticipated, while the eventual influx of new capital from alternative sources threatens to soften the market and compress future returns.
The 6 reinsurance stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 4.1%.
In light of this news, share prices of the companies have held steady as they are up 2.1% on average since the latest earnings results.
Fidelis Insurance (NYSE:FIHL)
Founded in Bermuda in 2014 and designed to adapt nimbly to evolving market conditions, Fidelis Insurance (NYSE:FIHL) is a global specialty insurer and reinsurer that provides customized coverage across property, specialty, and bespoke risk solutions.
Fidelis Insurance reported revenues of $589.3 million, up 9.1% year on year. This print fell short of analysts’ expectations by 8.9%, but it was still a satisfactory quarter for the company with a beat of analysts’ EPS estimates but a significant miss of analysts’ net premiums earned estimates.
Dan Burrows, Group Chief Executive Officer of Fidelis Insurance Group, commented: “We have continued to successfully execute on our strategy of balancing the pursuit of profitable underwriting opportunities with returning meaningful capital to shareholders.
Fidelis Insurance delivered the weakest performance against analyst estimates of the whole group. The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $17.53.
Is now the time to buy Fidelis Insurance? Access our full analysis of the earnings results here, it’s free.
Best Q2: Hamilton Insurance Group (NYSE:HG)
Founded in 2013 and operating through three distinct underwriting platforms across four countries, Hamilton Insurance Group (NYSE:HG) operates global specialty insurance and reinsurance platforms across Lloyd's, Ireland, Bermuda, and the United States.
Hamilton Insurance Group reported revenues of $740.8 million, up 26% year on year, outperforming analysts’ expectations by 22.1%. The business had an exceptional quarter with a beat of analysts’ EPS and book value per share estimates.
Hamilton Insurance Group delivered the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 12.2% since reporting. It currently trades at $24.16.
Is now the time to buy Hamilton Insurance Group? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Reinsurance Group of America (NYSE:RGA)
Operating behind the scenes of the insurance industry since 1973, Reinsurance Group of America (NYSE:RGA) provides life and health reinsurance services to insurance companies, helping them manage risk and meet regulatory requirements.
Reinsurance Group of America reported revenues of $5.68 billion, up 10.9% year on year, exceeding analysts’ expectations by 1.1%. Still, it was a slower quarter as it posted a significant miss of analysts’ net premiums earned and EPS estimates.
As expected, the stock is down 1.6% since the results and currently trades at $189.32.
Read our full analysis of Reinsurance Group of America’s results here.
AXIS Capital (NYSE:AXS)
Founded in the aftermath of the 9/11 attacks when insurance capacity was scarce, AXIS Capital Holdings Limited (NYSE:AXS) is a global specialty insurer and reinsurer that provides coverage for complex risks across property, liability, professional lines, cyber, and other specialty markets.
AXIS Capital reported revenues of $1.63 billion, up 8.6% year on year. This number was in line with analysts’ expectations. Taking a step back, it was a mixed quarter as it also produced a beat of analysts’ EPS estimates but a significant miss of analysts’ net premiums earned estimates.
The stock is down 1.2% since reporting and currently trades at $95.97.
Read our full, actionable report on AXIS Capital here, it’s free.
Everest Group (NYSE:EG)
Rebranded from Everest Re in 2023 to reflect its evolution beyond just reinsurance, Everest Group (NYSE:EG) underwrites property and casualty reinsurance and insurance worldwide, serving insurance companies, corporations, and other clients across six continents.
Everest Group reported revenues of $4.49 billion, up 6.2% year on year. This print surpassed analysts’ expectations by 1.7%. It was a strong quarter as it also recorded a solid beat of analysts’ net premiums earned and EPS estimates.
Everest Group had the slowest revenue growth among its peers. The stock is up 1.6% since reporting and currently trades at $339.84.
Read our full, actionable report on Everest Group here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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