Employers Holdings Stock Fair Value – EMPLOYERS HOLDINGS Reports Fourth Quarter of FY2022 Earnings Results on December 31, 2022.

Earnings Overview

EMPLOYERS HOLDINGS ($NYSE:EIG) reported an overall revenue of USD 47.2 million and net income of USD 221.8 million for the fourth quarter of fiscal year 2022, which concluded on February 16, 2023. This represented a 13.9% decrease in total revenue compared to the same quarter the previous year, while net income increased 11.0% year-over-year.

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The increase was driven by higher net investment income and favorable prior year loss reserve developments of $23 million. Commission expenses increased due to higher earned premiums and new business writings, while underwriting and general and administrative expenses were higher due to premium taxes and assessments. Income tax expense was $9 million with a 16% effective rate, benefiting from tax benefits and exclusions associated with tax-advantaged investment income. The Employers segment had underwriting income of $24 million, down from $28 million a year ago, with a resulting calendar year combined ratio of 87%.

The Cerity segment had an underwriting loss of $3 million for the quarter. Net after-tax unrealized gains from equity securities and other investments in the quarter were $11 million and net after-tax unrealized gains from fixed maturity securities benefited stockholders’ equity and book value per share by $20 million. Finally, during the quarter, the company repurchased $1.7 million of its common stock at an average price of $42.15 per share.

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Employers Holdings. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Employers Holdings. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Employers Holdings. More…

Key Ratios Snapshot

Some of the financial key ratios for Employers Holdings are shown below. More…

Share Price

T h e s t o c k o p e n e d a t $ 4 2 . 9 a n d c l o s e d a t $ 4 3 . 6 % f r o m t h e p r e v i o u s c l o s i n g p r i c e o f $ 4 3 . 3 . 2 % c o m p a r e d t o t h e p r e v i o u s y e a r .

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Analysis – Employers Holdings Stock Fair Value

At GoodWhale, we recently conducted an analysis of EMPLOYERS HOLDINGS‘s wellbeing. After reviewing their financials, stock market performance and other factors, our proprietary Valuation Line determined the fair value of EMPLOYERS HOLDINGS’s share to be around $37.5. However, currently EMPLOYERS HOLDINGS is trading at $43.0, which is an overvaluation of 14.8%. This presents an interesting opportunity for investors looking to capitalize on potentially higher returns in the future. We recommend that investors conduct their own due diligence before making any substantial investments in the stock. More…

Peers

The four companies mentioned are all in the business of providing financial protection to employers in the event of employee injuries. They are all large, well-established companies with strong reputations. Employers Holdings is the smallest of the four, but it is growing rapidly and is increasingly seen as a serious competitor by its larger rivals.

– MGIC Investment Corp ($NYSE:MTG)

MGIC Investment Corporation, through its subsidiaries, provides private mortgage insurance, and ancillary services to lenders and government sponsored entities in the United States. The company operates through two segments, Primary Mortgage Insurance, and Ancillary Services and Other. The Primary Mortgage Insurance segment provides mortgage insurance on first-lien mortgage loans.

– Brown & Brown Inc ($NYSE:BRO)

Brown & Brown, Inc., through its subsidiaries, operates as an insurance and reinsurance intermediary that markets and sells insurance products and services in the United States and internationally. The company operates in two segments, Retail and Wholesale. The Retail segment offers a range of insurance products and services, including commercial property and casualty, workers’ compensation, surety, general liability, professional liability, automobile, and homeowners insurance products, as well as risk management consulting services. This segment also provides employee benefits products and services, including group health, workers’ compensation, property and casualty, and executive benefit products. The Wholesale segment offers excess and surplus lines, program business, and specialty lines of property and casualty insurance products, as well as professional liability insurance products. Brown & Brown, Inc. was founded in 1939 and is headquartered in Daytona Beach, Florida.

– Protector Forsikring ASA ($LTS:0JXF)

Protector Forsikring ASA is a Norway-based company engaged in the insurance industry. The Company offers a range of personal and corporate insurance products, including car, home, boat, travel, health, and life insurance.

Summary

Investors should take note of EMPLOYERS HOLDINGS’ fourth quarter fiscal year 2022 results, as reported on December 31, 2022. Total revenue for the quarter was USD 47.2 million, a 13.9% decrease from the previous year.

However, net income was USD 221.8 million, an 11.0% increase from the previous year. These figures suggest that EMPLOYERS HOLDINGS has been able to improve its profitability despite a decrease in overall revenues. Investors should consider this in their analysis of the company and watch for future developments.