Universal Insurance (NYSE:UVE) Shares Gap Up Following Strong Earnings

Key Points

• Universal Insurance shares gapped up after the company reported stronger-than-expected quarterly earnings, opening at $39.75 versus the prior close of $37.68 and trading higher intraday.
• The insurer posted earnings per share of $1.84, beating analysts’ estimate of $1.57 by $0.27, though revenue of $419.38 million came in below the consensus estimate.
• The company also announced a quarterly dividend of $0.16 per share, payable August 7, while analysts currently rate the stock a consensus Hold with a $44 price target.

Universal Insurance Holdings Inc (NYSE:UVE - Get Free Report)'s share price gapped up prior to trading on Friday after the company announced better than expected quarterly earnings. The stock had previously closed at $37.68, but opened at $39.75. Universal Insurance shares last traded at $40.9840, with a volume of 25,953 shares changing hands.

The insurance provider reported $1.84 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $1.57 by $0.27. The business had revenue of $419.38 million during the quarter, compared to the consensus estimate of $614.62 million. Universal Insurance had a net margin of 12.22% and a return on equity of 37.51%.

Universal Insurance Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Friday, August 7th. Investors of record on Friday, July 31st will be issued a $0.16 dividend. This represents a $0.64 dividend on an annualized basis and a dividend yield of 1.5%. The ex-dividend date of this dividend is Friday, July 31st. Universal Insurance's payout ratio is 9.48%.

Analyst Ratings Changes

Several brokerages have weighed in on UVE. Piper Sandler lowered Universal Insurance from an "overweight" rating to a "neutral" rating and set a $44.00 price objective for the company. in a report on Wednesday, July 15th. Zacks Research cut Universal Insurance from a "strong-buy" rating to a "hold" rating in a research report on Tuesday, June 23rd. Wall Street Zen downgraded Universal Insurance from a "strong-buy" rating to a "buy" rating in a research note on Saturday, May 2nd. Finally, Weiss Ratings reissued a "buy (b)" rating on shares of Universal Insurance in a report on Friday, July 17th. One analyst has rated the stock with a Buy rating and two have given a Hold rating to the company. According to data from MarketBeat.com, the company currently has a consensus rating of "Hold" and a consensus price target of $44.00.

Insider Activity

In other news, Chairman Sean P. Downes sold 20,000 shares of the firm's stock in a transaction on Thursday, June 11th. The stock was sold at an average price of $38.22, for a total value of $764,400.00. Following the completion of the transaction, the chairman directly owned 1,148,255 shares of the company's stock, valued at $43,886,306.10. This trade represents a 1.71% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Insiders sold a total of 60,000 shares of company stock worth $2,332,800 in the last quarter. Corporate insiders own 15.00% of the company's stock.

Institutional Trading of Universal Insurance

Institutional investors have recently added to or reduced their stakes in the stock. Vanguard Group Inc. increased its position in shares of Universal Insurance by 2.8% during the fourth quarter. Vanguard Group Inc. now owns 2,007,725 shares of the insurance provider's stock valued at $67,861,000 after buying an additional 54,004 shares during the period. Geode Capital Management LLC grew its stake in Universal Insurance by 19.8% during the fourth quarter. Geode Capital Management LLC now owns 815,484 shares of the insurance provider's stock valued at $27,566,000 after acquiring an additional 134,805 shares in the last quarter. Goldman Sachs Group Inc. increased its holdings in Universal Insurance by 9.4% during the 1st quarter. Goldman Sachs Group Inc. now owns 805,199 shares of the insurance provider's stock worth $19,083,000 after acquiring an additional 69,289 shares during the period. Millennium Management LLC lifted its stake in Universal Insurance by 212.3% in the 3rd quarter. Millennium Management LLC now owns 596,370 shares of the insurance provider's stock worth $15,685,000 after purchasing an additional 405,403 shares in the last quarter. Finally, Arrowstreet Capital Limited Partnership boosted its holdings in Universal Insurance by 11.5% in the 3rd quarter. Arrowstreet Capital Limited Partnership now owns 506,683 shares of the insurance provider's stock valued at $13,326,000 after purchasing an additional 52,187 shares during the period. Hedge funds and other institutional investors own 66.61% of the company's stock.

Universal Insurance Price Performance

The business's 50-day moving average price is $39.15 and its 200 day moving average price is $35.57. The stock has a market capitalization of $1.16 billion, a PE ratio of 6.09 and a beta of 0.72. The company has a debt-to-equity ratio of 0.17, a quick ratio of 0.51 and a current ratio of 0.51.

Universal Insurance Company Profile

Universal Insurance Holdings, Inc NYSE: UVE is a property and casualty insurance holding company headquartered in Jacksonville, Florida. The company underwrites homeowners and other residential property insurance products to protect against natural catastrophes such as hurricanes, windstorms and fires. It distributes policies primarily through a network of independent agents and brokers, offering coverage for primary residences, secondary homes, condominiums, vacant dwellings and rental properties across its service territory.

In addition to personal lines, Universal provides commercial property and casualty insurance tailored to small businesses and institutional clients.

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