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Chubb (CB)
NYSE:CB
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Chubb
(NYSE:CB)78Outperform
Positive Factors
Earnings
Chubb Limited's fourth-quarter results beat both the analyst's estimate and consensus, showing strong performance.
Growth Opportunities
Recent strategic actions, like acquiring Cigna’s Asia-Pacific business and launching new products, are expected to drive growth in emerging markets.
Negative Factors
Catastrophe Losses
Management expects $1.5bn catastrophe losses in 1Q25E from the Los Angeles wildfires, which is higher than the $1.3bn expectation.
Chubb (CB) vs. S&P 500 (SPY)
Market Cap
$113.78B
Dividend Yield1.24%
Average Volume (3M)1.56M
Price to Earnings (P/E)12.5
Beta (1Y)0.32
Revenue Growth11.78%
EPS Growth4.39%
CountryUS
Employees40,000
SectorFinancial
Sector Strength93
IndustryInsurance
Share Statistics
EPS (TTM)22.71
Shares Outstanding400,412,080
10 Day Avg. Volume1,529,281
30 Day Avg. Volume1,557,994
Financial Highlights & Ratios
PEG Ratio2.85
Price to Book (P/B)N/A
Price to Sales (P/S)2.08
Price to Cash Flow (P/CF)6.40
P/FCF Ratio6.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$304.31Price Target Upside7.09% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering16
Chubb Business Overview & Revenue Model
Company DescriptionChubb Limited, formerly known as ACE Limited, provides insurance and reinsurance products worldwide. With approximately 33,000 employees, the company operates in 54 countries and territories. The company’s insurance products cover life insurance, property and casualty (P&C), accident and health, and reinsurance. Chub is also the world’s largest publicly traded P&C insurance company. The company operates under six segments: North America Commercial P&C Insurance, North America Personal P&C Insurance, North America Agricultural Insurance, Overseas General Insurance, Global Reinsurance, and Life Insurance.
How the Company Makes MoneyChubb makes money primarily through the underwriting of insurance policies and investment income. The company collects premiums from policyholders, which serves as a significant revenue stream. These premiums are used not only to cover claims but also to be invested in various financial instruments, generating additional income. Chubb's underwriting operations are divided into segments such as North America Commercial P&C Insurance, North America Personal P&C Insurance, and Overseas General Insurance, each contributing to the company's revenue. Additionally, strategic partnerships and joint ventures in different regions enhance its market reach and customer base, further bolstering earnings. The company's disciplined underwriting practices and diversified portfolio help manage risk and ensure profitability.
Chubb Financial Statement Overview
Summary
Chubb exhibits strong financial health with consistent revenue growth and robust cash flow generation. The balance sheet is stable, although rising debt levels require monitoring. Overall, Chubb is well-positioned in the insurance industry, but attention to debt management and potential investment needs is advisable.Income Statement
Chubb has demonstrated strong revenue growth over the years, with a substantial increase from $34.23 billion in 2019 to $49.83 billion in 2023. The gross profit margin is consistently at 100% due to the nature of the insurance business where total revenue equals gross profit. The EBIT and EBITDA margins are solid, reflecting strong operational efficiency. Net profit margin is robust, with a notable increase in net income to $9.27 billion in 2024. However, the 2024 data lacks a total revenue figure, making it challenging to evaluate the latest margins accurately.85
Very Positive
Balance Sheet
Chubb maintains a strong equity position, with stockholders' equity increasing from $55.33 billion in 2019 to $64.02 billion in 2024. The debt-to-equity ratio is manageable, indicating prudent financial leverage. The equity ratio shows a stable balance between assets and liabilities. However, the total debt has increased slightly, which could pose risks if not managed carefully.75
Positive
Cash Flow
Chubb's operating cash flow has shown consistent growth, indicating strong cash generation capabilities. The free cash flow has also increased, supporting healthy financial flexibility. The operating cash flow to net income ratio is favorable, suggesting efficient cash earnings conversion. However, the absence of capital expenditures in recent years raises questions about potential underinvestment.80
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 40.89B | 56.01B | 49.83B | 43.12B | 40.96B | 35.99B | Gross Profit |
| 40.86B | 56.01B | 49.83B | 43.12B | 40.96B | 35.99B | EBIT |
| 8.95B | 0.00 | 9.39B | 7.14B | 9.82B | 4.16B | EBITDA |
| 9.18B | 0.00 | 10.20B | 7.34B | 10.57B | 4.97B | Net Income Common Stockholders |
| 7.16B | 9.27B | 9.03B | 5.25B | 8.53B | 3.53B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 39.19B | 39.19B | 4.55B | 2.01B | 1.66B | 1.75B | Total Assets |
| 246.55B | 246.55B | 230.68B | 199.02B | 200.05B | 190.77B | Total Debt |
| 15.18B | 15.18B | 14.49B | 14.88B | 16.17B | 14.95B | Net Debt |
| 12.89B | 12.89B | 12.05B | 12.87B | 14.51B | 13.20B | Total Liabilities |
| 178.15B | 178.15B | 166.99B | 148.50B | 140.34B | 131.33B | Stockholders Equity |
| 64.02B | 64.02B | 59.51B | 50.52B | 59.71B | 59.44B |
| Cash Flow | Free Cash Flow | ||||
| 11.86B | 16.18B | 12.63B | 11.24B | 12.57B | 10.69B | Operating Cash Flow |
| 11.08B | 16.18B | 12.63B | 11.24B | 11.15B | 9.79B | Investing Cash Flow |
| -3.51B | -13.92B | -7.65B | -5.65B | -6.66B | -7.52B | Financing Cash Flow |
| -2.11B | -2.18B | -4.49B | -5.13B | -4.41B | -2.08B |
Chubb Technical Analysis
Positive
284.15
Price Trends
271.79
Positive
278.02
Positive
273.95
Positive
Market Momentum
3.42
Negative
61.40
Neutral
88.40
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CB, the sentiment is Positive. The current price of 284.15 is above the 20-day moving average (MA) of 272.66, above the 50-day MA of 271.79, and above the 200-day MA of 273.95, indicating a bullish trend. The MACD of 3.42 indicates Negative momentum. The RSI at 61.40 is Neutral, neither overbought nor oversold. The STOCH value of 88.40 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CB.
Chubb Risk Analysis
Chubb disclosed 37 risk factors in its most recent earnings report. Chubb reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Chubb Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $113.78B | 12.52 | 14.48% | 1.24% | 11.78% | 4.39% | |
78 Outperform | $22.42B | 9.86 | 16.45% | 2.20% | 13.22% | 24.83% | |
75 Outperform | $57.97B | 11.91 | 17.94% | 1.59% | 12.23% | 68.50% | |
74 Outperform | $166.01B | 19.67 | 33.14% | 1.72% | 21.36% | 118.77% | |
72 Outperform | $53.55B | 11.89 | 21.77% | 1.82% | 12.28% | ― | |
71 Outperform | $47.38B | 15.77 | -3.30% | 1.89% | -28.56% | 1.14% | |
64 Neutral | $14.34B | 10.61 | 9.28% | 4.07% | 18.04% | -9.54% |
* Financial Sector Average
Performance Comparison
CB
Chubb
284.15
38.07
15.47%
ALL
Allstate
199.03
44.58
28.86%
AIG
American International Group
79.85
7.48
10.34%
CINF
Cincinnati Financial
143.26
34.12
31.26%
PGR
Progressive
283.19
97.21
52.27%
TRV
Travelers Companies
255.70
40.48
18.81%
Chubb Earnings Call Summary
Earnings Call Date: Jan 28, 2025 | % Change Since: 4.36% | Next Earnings Date: Apr 29, 2025
Earnings Call Sentiment Positive
Chubb displayed robust performance with record underwriting income, investment growth, and premium increases across most divisions. However, significant costs associated with California wildfires and challenges in financial lines and specific regions like Latin America and the London market present notable concerns.Highlights
Record P&C Underwriting Income
Chubb achieved record P&C underwriting income with a combined ratio of 85.7, contributing to a core operating income of $2.5 billion for the quarter.
Investment Income Growth
Adjusted net investment income increased by 19.3% to $6.4 billion for the year, with a quarterly record of $1.7 billion, up 13.7%.
Global P&C and Life Premium Growth
Global P&C premium revenue grew 9.9% and life premiums increased by 18.5% in constant dollars for the year.
Strong Shareholder Returns
Core operating ROE was approximately 14% and return on tangible equity was 21.6%. Book and tangible book value grew 8.8% and 14.1%, respectively.
Significant Growth in International Life Business
Premiums and deposits in the international life business increased over 26% in constant dollars.
Resilient North America and International Operations
North America P&C premiums grew 6.3% excluding agriculture, while international general insurance operations saw a 7.7% increase in retail business premiums.
Lowlights
Cost of California Wildfires
Estimated financial impact of California wildfires is $1.5 billion net pre-tax, classified as a first quarter 2025 event.
Decline in Financial Lines Premium
North America financial lines premiums declined by 2.9%, with specific challenges in D&O and employment practices liability due to increased competition.
Challenges in Latin America
Latin America premium growth was only 2.5%, impacted by foreign exchange. Adjusted for FX, growth was 11.5% in constant dollars.
London Market Competition
Premiums in the London wholesale business remained flat, with prices down 4% due to increased competition.
Company Guidance
During Chubb Limited's fourth quarter 2024 earnings call, the company provided detailed guidance on various financial metrics and future expectations. Chubb reported a record P&C underwriting income with a combined ratio of 85.7% and core operating income of $2.5 billion for the quarter, marking a 9.4% increase in pre-tax operating earnings and a 10.5% increase per share. The company's global P&C premium revenue grew by 6.7% during the quarter, while life insurance premiums increased by 8.5% in constant dollars. For the full year, Chubb generated $9.1 billion in operating income, reflecting an 11.5% increase adjusted for a one-time tax benefit, and a 13% rise on a per-share basis. The company also highlighted a strong core operating return on equity (ROE) of about 14% and a return on tangible equity of 21.6%. Looking ahead to 2025, Chubb expressed optimism, expecting continued growth in operating earnings and EPS at a double-digit rate, supported by P&C underwriting, investment income, and life income, despite potential influences from catastrophic losses and foreign exchange fluctuations.Chubb Corporate Events
Business Operations and StrategyFinancial Disclosures
Chubb Highlights Strategic Growth in Investor Presentation
Neutral
Dec 9, 2024
Chubb Limited has released an investor presentation available on its website, highlighting the company’s financial performance, business mix, strategic initiatives, and growth opportunities. This presentation is intended for investor meetings from December 9, 2024, and will be accessible for at least 60 days, offering valuable insights for those interested in the financial markets.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.