Insurance Earnings So Far 2Q07 — Part IV

Insurance stocks got hit as hard today as on Tuesday.  In general, though, away from financial insurers, earnings have been pretty good.  Here’s the file with the data for this earnings season so far.  I’ve added a chart, showing how much price outperformance generally happens from beating earnings.  General findings so far:

  • Beating earnings by 10% leads to beating the price performance of the index by about 1%.
  • Brokers and Commercial Lines are doing the best so far.
  • Positive price performance is associated with growing revenues, and raising guidance.
  • With the credit furor going on, it is no surprise that financial insurers are doing the worst of all of the subgroups.

Of the companies reporting that I own, both beat estimates.  Hartford is a well-run battleship of a company, very well balanced.  Aspen had fewer UK flood claims than the market feared, but who can tell about 3Q?  With a growing top line, looks promising for the future.

Full disclosure: long AHL HIG