Universal Insurance Holdings (UVE) reported quarterly loss of $0.73 per share versus the Zacks Consensus Estimate for a loss of $1.03. This compares to a loss of $0.16 per share a year ago. These figures are adjusted for one-time items.
This quarterly report represents an earnings surprise of 29.13%. A quarter ago, it was expected that this property and casualty insurance company would post earnings of $1.15 per share when it actually produced earnings of $1.18 generated, which corresponds to a surprise of 2.61%.
Over the last four quarters, the company has surpassed consensus EPS estimates four times.
Universal Insurance, which belongs to the Zacks Insurance – Property and Casualty industry, posted revenues of $387.55 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 13.33%. This compares to year-ago revenue of $360.05 million. The company has topped consensus revenue estimates four times over the past four quarters.
The sustainability of the stock’s immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management’s commentary on the earnings release.
Shares of Universal Insurance have gained about 22.8% since the beginning of the year versus the S&P 500’s gain of 21.5%.
While Universal Insurance has outperformed the market so far this year, the question that comes to investors’ minds is: what’s next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company’s earnings outlook. Not only does this include current consensus earnings expectations for the coming quarters, but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend for Universal Insurance is unfavorable. While the magnitude and direction of estimate revisions could change following the company’s just-released earnings report, the current status results in a Zacks Rank #4 (Sell) for the stock. Therefore, the stock is expected to underperform the market in the near future. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
