CHICAGO, May 16, 2011 /PRNewswire/ -- Zacks.com announces
the list of stocks featured in the Analyst Blog. Every day the
Zacks Equity Research analysts discuss the latest news and events
impacting stocks and the financial markets. Stocks recently
featured in the blog include: Allstate Corp. (NYSE:
ALL), Aon Corp. (NYSE: AON), PartnerRe
Ltd. (NYSE: PRE),
Aflac Inc. (NYSE: AFL) and
MetLife Inc. (NYSE: MET).
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Here are highlights from Friday's Analyst Blog:
Allstate CAT Loss Soars for April
Yesterday, home and auto insurer Allstate
Corp. (NYSE: ALL) projected about $1.4 billion in catastrophe (CAT) losses for
April 2011. Of this, $1.37 billion has been estimated for the Allstate
brand while $30 million of loss is
expected from the Encompass brand. This projection is almost close
to the CAT loss recorded for whole of 2010.
Allstate's CAT losses in April include 13 natural disasters in
the US and Canada. Particularly,
tornadoes harshly hit the Midwest and Southern areas such as
Alabama, Arkansas, Georgia and Virginia, thereby increasing the claims
payments in these areas.
According to leading insurer Aon Corp. (NYSE:
AON), insurance industry CAT losses were impacted by over
$5 billion, last month, from the
storms in Alabama and wildfires in
Texas.
Allstate has more than 10,000 claims cases to deal with till
date, for which the company has positioned over 3,000 professionals
in these areas.
Furthermore, given the extreme loss nature of catastrophes,
Allstate has decided to regularly the release of its CAT losses if
they exceed $150 million on a monthly
basis. However, CAT losses for Allstate have exceeded this
benchmark for only 30% of the months over the past decade.
Even during the first quarter of 2011, Allstate's CAT losses
stood at $333 million, substantially
lower than $648 million in the
year-ago period. This also helped the net income in
Property-Liability segment to surge to $468
million from $164 million in
the prior-year quarter.
Reduced expenses and losses also aided in improving the first
quarter operating earnings of 93
cents per share, which came in substantially ahead of the
Zacks Consensus Estimate of 68 cents
and 69 cents per share recorded in
the year-ago quarter.
However, we believe that despite the increase in rates, Allstate
would report earnings of 79 cents in
the second quarter, down 2.3% year over year, according to the
Zacks Consensus Estimate, on the back of mounting CAT
losses.
Severe weather-related adverse events have become a growing
concern for insurers and reinsurers in recent years. The
weather-pattern changes have been leading to regular occurrence of
floods, earthquakes, hurricanes, hailstorms, tsunami etc.
During the first quarter, almost all the insurance giants posted
lower-than-expected earnings owing to higher CAT losses.
While PartnerRe Ltd. (NYSE: PRE) plummeted on
charging $1.02 billion driven by the
huge loss from the recent catastrophes in Japan, New
Zealand and
Australia. Aflac Inc. (NYSE:
AFL) incurred increased expenses due to the Japan catastrophe.
Operating earnings for MetLife Inc.'s (NYSE: MET)
auto and home segment significantly plummeted 21% year over year
based on higher-than-expected CAT losses while insurance products
also witnessed a decline.
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