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Reinsurance Group of America Earnings Preview

Investors are on the edge of their collective seats, hoping that Reinsurance Group of America (NYSE: RGA  ) will top analyst expectations for the fourth consecutive quarter. The company will unveil its latest earnings on Monday, July 25. Reinsurance Group of America is an insurance holding company, which is engaged in traditional individual and group life, asset-intensive, critical-illness, and financial reinsurance.

What analysts say:

  • Buy, sell, or hold?: Analysts strongly back Reinsurance Group of America, with seven of 10 rating it a buy and the remainder rating it a hold. Analysts like Reinsurance Group of America better than competitor Everest Re Group overall. While analysts still rate the stock a moderate buy, they are a little more optimistic about it compared with three months ago.
  • Revenue forecasts: On average, analysts predict $2.14 billion in revenue this quarter. That would represent a rise of 12.6% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $1.82 per share. Estimates range from $1.77 to $1.88.

What our community says:
CAPS All-Stars are solidly behind the stock, with 93.3% giving it an "outperform" rating. The community at large backs the All-Stars, with 91.4% awarding it a rating of "outperform." Fools have embraced Reinsurance Group of America, though the message boards have been quiet lately, with only 25 posts in the past 30 days. Despite the majority sentiment in favor of Reinsurance Group of America, the stock has a middling CAPS rating of three out of five stars.

Management:
Reinsurance Group of America's profit has risen year over year by an average of 24.4%. Revenue has now gone up for three straight quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows net margins over the past four quarters. 

Quarter Q1 Q4 Q3 Q2
Net Margin 7% 8.6% 6.6% 6.6%
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DocumentId: 1521628, ~/Articles/ArticleHandler.aspx, 5/26/2012 11:11:32 AM

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Related Tickers

5/25/2012 4:05 PM
RGA $50.30 Down -0.06 -0.12%
Reinsurance Group… CAPS Rating: *****

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