Why Is Chubb (CB) Up 3.5% Since Last Earnings Report?

A month has gone by since the last earnings report for Chubb (CB). Shares have added about 3.5% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Chubb due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important catalysts.

Chubb Q2 Earnings, Revenues Top Estimates on Strong Underwriting

Chubb Limited reported second-quarter 2025 core operating income of $6.14 per share, which outpaced the Zacks Consensus Estimate by 4.2%. The bottom line increased 14.1% year over year.

The quarter benefited solid underwriting and strong investment income, and double-digit growth in life income.

Quarter in Detail

Net premiums written improved 6.3% year over year to $14.2 billion in the quarter, which is in line with the Zacks Consensus Estimate. Our estimate was pegged at $14 billion. 

Net investment income was $1.5 billion, up 6.8 % year over year. The Zacks Consensus Estimate was pegged at $1.8 billion, while our estimate for the same was $1.9 billion. 

Revenues of $14.8 million missed the Zacks Consensus Estimate by a whisker but improved 6.9% year over year.

Property and casualty (P&C) underwriting income was $1.6 billion, up 15% year over year.  Premium growth and underwriting margin improvement drove underwriting income. Global P&C underwriting income, excluding Agriculture, was $1.56 billion, up 13.2% year over year.

Chubb incurred a pre-tax P&C catastrophe loss, net of reinsurance and including reinstatement premiums of $630 million, which was wider than the year-ago catastrophe loss of $580 million. 

The P&C combined ratio improved by 120 basis points (bps) on a year-over-year basis to 85.6% in the quarter under review. The Zacks Consensus Estimate for combined ratio was pegged at 85, while our estimate was 72.6.

Segmental Update

North America Commercial P&C Insurance: Net premiums written increased 4.1% year over year to $5.7 billion. Our estimate was $6 billion. The combined ratio deteriorated 60 bps to 83.5%, reflecting higher catastrophe losses. Our estimate was 68.1.

North America Personal P&C Insurance: Net premiums written climbed 9.1% year over year to $1.9 billion. Our estimate was $1.8 billion. The Zacks Consensus Estimate was pegged at $1.7 billion. The combined ratio improved 1000 bps to 73.5%, reflecting higher favorable prior period development and lower catastrophe losses. Our estimate was 82.5.

North America Agricultural Insurance: Net premiums written decreased 3.3% from the year-ago quarter to $733 million, primarily due to lower commodity prices. Our estimate was $773.9 million. The combined ratio improved 530 bps to 89.1%, reflecting lower catastrophe losses and higher favorable prior period development. 

Overseas General Insurance: Net premiums written climbed 8.5% year over year to $3.6 billion. Our estimate was $3.5 billion. The Zacks Consensus Estimate was pegged at $3.6 billion. The combined ratio deteriorated 210 bps to 90.3% due to higher catastrophe losses.  Our estimate was 77.

Global Reinsurance: Net premiums written decreased 7.6% year over year to $380 million. Our estimate was $438.4 million. The Zacks Consensus Estimate was pegged at $445 million. The combined ratio improved 170 bps to 71%. Our estimate was 76.3.

Life Insurance: Net premiums written increased 14.1% year over year to $1.8 billion with growth of 17.8% in International Life and 18.1% in Combined Insurance North America. Our estimate was $1.5 billion. The Zacks Consensus Estimate was pegged at $1.7 billion.

The Life Insurance segment income was $305 million, up 10.4% year over year. 

Financial Update

The cash and restricted cash balance of $2.4 billion, as of June 30, 2025, decreased 7% from the 2024-end level. Total shareholders’ equity grew 8.8% from the level at 2024-end to $74.4 billion as of June 30, 2025. Book value per share, as of June 30, 2025, was $174.07, up 8.9% from the figure as of Dec. 31, 2024.

Core operating return on tangible equity declined 10 bps year over year to 21%. Operating cash flow was $3.5 billion in the quarter under consideration, while adjusted operating cash flow was $3.2 billion.

Capital Deployment

In the quarter, Chubb bought back shares worth $676 million and paid $388 million in dividends.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in estimates review.

VGM Scores

At this time, Chubb has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a score of B on the value side, putting it in the second quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Chubb has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Chubb is part of the Zacks Insurance - Property and Casualty industry. Over the past month, Progressive (PGR), a stock from the same industry, has gained 2.1%. The company reported its results for the quarter ended June 2025 more than a month ago.

Progressive reported revenues of $21.62 billion in the last reported quarter, representing a year-over-year change of +18.4%. EPS of $4.88 for the same period compares with $2.65 a year ago.

For the current quarter, Progressive is expected to post earnings of $3.81 per share, indicating a change of +6.4% from the year-ago quarter. The Zacks Consensus Estimate has changed +1.3% over the last 30 days.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Progressive. Also, the stock has a VGM Score of A.

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This article originally published on Zacks Investment Research (zacks.com).

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