- Essent Group (NYSE:ESNT +0.2%) plans to enter another insurance-linked note deal during H1 2019 to cover insurance in force generated during 2018, that would bring insurance in force covered with ILNs and reinsurance to 50% from 30%, management said in its Q4 earnings call.
- They plan to pursue additional ILN offerings and reinsurance deals in the next three years with the aim of covering all of Essent's IIF, writes BTIG analyst Mark Palmer in a note to clients.
- Management sees FY2019 new insurance written in line with $47.5B generated during FY2018.
- BTIG reiterates buy recommendation with price target of $54.
- Q4 EPS of $1.31 per share was helped by a $9.9M reduction, or 8 cents, in the loss reserve established in Q4 2017 for defaulted loans related to Hurricanes Harvey and Irma.
- Excluding the reserve reduction, Q4 EPS would be $1.23, four cents more than the consensus estimate of $1.19.
- Q4 new insurance written of $11.4B compares with $13.9B in Q3 and $11.2B in the year-ago quarter.
- Q4 net premiums earned of $173.3M increased from $166.7M in Q3 and $148.0M in Q4 2017.
- Q4 combined ratio was 22.2% vs. 25.4% in Q3 and 36.4% in Q4 2017.
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Analyst ratings.
- Previously: Essent Group beats by $0.13, beats on revenue (Feb. 8)