Universal Insurance Holdings, Inc. (UVE, Financial) has announced robust financial results for the first quarter, reporting a revenue of $394.87 million. This marks a notable increase from the $367.96 million generated during the same period last year.
The company attributes this positive performance to transformative legislative reforms enacted in Florida in 2022. These reforms have introduced greater stability to the property insurance market, offering policyholders enhanced security and more options.
Additionally, Universal Insurance Holdings benefited from reduced weather-related losses during the quarter, positively impacting their loss and loss adjustment expenses (LAE) ratio. This decline in weather losses contributed significantly to the company's improved financial standing.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 1 analysts, the average target price for Universal Insurance Holdings Inc (UVE, Financial) is $27.00 with a high estimate of $27.00 and a low estimate of $27.00. The average target implies an upside of 15.43% from the current price of $23.39. More detailed estimate data can be found on the Universal Insurance Holdings Inc (UVE) Forecast page.
Based on the consensus recommendation from 2 brokerage firms, Universal Insurance Holdings Inc's (UVE, Financial) average brokerage recommendation is currently 2.5, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Universal Insurance Holdings Inc (UVE, Financial) in one year is $18.70, suggesting a downside of 20.05% from the current price of $23.39. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Universal Insurance Holdings Inc (UVE) Summary page.
UVE Key Business Developments
Release Date: February 26, 2025
- Adjusted Diluted Earnings Per Share: $0.25, down from $0.43 in the prior year quarter.
- Core Revenue: $386.4 million, up 5.7% year over year.
- Direct Premiums Written: $470.9 million, up 8.8% from the prior year quarter.
- Direct Premiums Earned: $519.3 million, up 7.7% year over year.
- Net Premiums Earned: $348.4 million, up 3.9% from the prior year quarter.
- Net Combined Ratio: 107.9%, up 4.2 points from the prior year quarter.
- Loss Ratio: 82.3%, up 0.4 points from the prior year quarter.
- Net Expense Ratio: 25.6%, up 3.8 points from 21.8% in the prior year quarter.
- Share Repurchase: Approximately 370,000 shares repurchased at an aggregate cost of $7.7 million.
- Quarterly Cash Dividend: $0.16 per common share declared, payable March 14, 2025.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Universal Insurance Holdings Inc (UVE, Financial) reported a 5.7% year-over-year increase in core revenue, driven by higher net premiums earned, net investment income, and commission revenue.
- Direct premiums written increased by 8.8% from the prior year quarter, with notable growth of 38.4% in states outside Florida.
- The company successfully placed 92% of its first event catastrophe tower for the 2025 reinsurance program, indicating strong reinsurance market support.
- Universal Insurance Holdings Inc (UVE) repurchased approximately 370,000 shares, demonstrating a commitment to returning value to shareholders.
- The board declared a regular quarterly cash dividend of $0.16 per common share, maintaining shareholder returns.
Negative Points
- Adjusted diluted earnings per share decreased to $0.25 from $0.43 in the prior year quarter, primarily due to lower underwriting income.
- The net combined ratio increased to 107.9%, up 4.2 points from the prior year quarter, reflecting higher net loss and expense ratios.
- The loss ratio rose to 82.3%, driven by higher weather losses, particularly from Hurricane Milton.
- The net expense ratio increased to 25.6%, up 3.8 points, due to higher policy acquisition costs and other operating expenses.
- Prior year reserve development was significantly down, impacting financial performance.
