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WORCESTER, Mass. - Hanover Insurance Group (NYSE:THG) reported fourth quarter earnings that significantly exceeded analyst estimates, driven by strong underwriting results and higher investment income. However, shares edged slightly lower, by 0.4%, in after-hours trading.
The property and casualty insurer posted operating earnings of $5.32 per share, handily beating the consensus estimate of $3.36 per share. Revenue rose 7.4% year-over-year to $1.45 billion, topping expectations of $1.43 billion.
Hanover’s combined ratio, a key measure of underwriting profitability, improved to 89.2% from 94.2% in the year-ago quarter. A lower combined ratio indicates better profitability.
"We delivered record operating return on equity of 24.4% in the fourth quarter," said John C. Roche, president and CEO of Hanover. He noted the company made significant progress on catastrophe mitigation initiatives and its margin recapture plan.
Net investment income jumped 23.4% to $100.7 million, benefiting from higher bond reinvestment rates and increased cash flows.
For the full year 2024, Hanover reported operating earnings of $13.34 per share on revenue of $6.08 billion. The company’s book value per share increased 14.9% year-over-year to $79.18.
The company said it expects to make continued progress in 2025 while leveraging targeted growth initiatives and capitalizing on emerging market opportunities.
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