Lancashire Holdings (LRE) AI Stock Analysis

• Market Cap: £1.55B
• Dividend Yield: 11.98%
• Average Volume (3M): 564.13K
• Price to Earnings (P/E): 8.5
• Beta (1Y): 1.02
• Revenue Growth: 8.78%
• EPS Growth: -38.83%
• Country: UK
• Employees: 426
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Specialty
• EPS (TTM): N/A
• Shares Outstanding: 244,010,010
• 10 Day Avg. Volume: 853,903
• 30 Day Avg. Volume: 564,126
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £703.63
• Price Target Upside: 8.75% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 79 Outperform
• Price Target: 689.00p ▲(6.49% Upside)

Lancashire Holdings' overall stock score is driven by strong financial performance and attractive valuation. The company's strategic growth initiatives and robust capital position further enhance its appeal. However, technical indicators suggest caution due to potential short-term weakness.

Lancashire Holdings Business Overview & Revenue Model

Company Description

Lancashire Holdings Limited, together with its subsidiaries, provides specialty insurance and reinsurance products in London, Bermuda, and Australia. The company operates through five segments: Property and Casualty Reinsurance, Property and Casualty Insurance, Aviation, Energy, and Marine. It offers property direct and facultative, property political risk and sovereign risk, and property terrorism and political violence insurance products, as well as property reinsurance services; and aviation AV52, aviation consortium, airline hull and liability, and satellite insurance products. The company also provides marine hull, total loss only, mortgagees interests insurance, mortgagees additional perils, excess protection and indemnity, marine war, and builder's risks; and energy insurance products covering upstream, downstream and onshore operational, and upstream construction all risks business. In addition, it offers general insurance, support, insurance agent, and insurance mediation services. The company was incorporated in 2005 and is headquartered in Hamilton, Bermuda.

How the Company Makes Money

Lancashire Holdings generates revenue primarily through the underwriting of insurance and reinsurance policies. The company's revenue model is based on collecting premiums from policyholders in exchange for assuming the risk of loss or damage, which forms its key revenue stream. Lancashire also earns investment income from its portfolio of cash and investments, which is managed conservatively to support its insurance operations. Significant partnerships with brokers and other distribution channels enhance its market reach, while its disciplined underwriting practices help maintain profitability by minimizing claims costs. The company’s focus on specialty risks allows it to charge higher premiums in exchange for its expertise, further contributing to its earnings.

Lancashire Holdings Financial Statement Overview

Summary

Lancashire Holdings shows strong financial performance with robust revenue growth and cash flow generation. Profitability metrics are solid, although the absence of EBIT in the latest year is a concern. The balance sheet is stable with controlled leverage, and cash flow metrics indicate effective cash management.

Income Statement

Lancashire Holdings has shown strong revenue growth with a Revenue Growth Rate of 19.5% year-over-year from 2023 to 2024. The Gross Profit Margin remains robust at 100% due to the nature of the insurance industry. However, the absence of EBIT in the latest year could be a concern, though EBITDA Margin holds at 24.8%. Net Profit Margin is solid at 21.5%, indicating profitability improvements.

Balance Sheet

The company's balance sheet shows a solid equity position with an Equity Ratio of 34.1%. The Debt-to-Equity Ratio is stable at 0.31, indicating manageable leverage. ROE stands at 21.5%, demonstrating effective equity utilization. However, the overall asset base has slightly decreased, which could be a point of concern.

Cash Flow

Cash flow performance is strong with a Free Cash Flow Growth Rate of 33.2% from 2023 to 2024. The Operating Cash Flow to Net Income Ratio is 1.79, indicating efficient operations generating cash. Free Cash Flow to Net Income Ratio is 1.76, reflecting strong cash conversion capabilities.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.20B	1.50B	1.25B	1.01B	751.10M	540.80M
Gross Profit	1.20B	1.50B	1.25B	1.01B	751.10M	540.80M
EBITDA	-37.10M	371.30M	364.50M	12.40M	-42.90M	26.20M
Net Income	321.50M	321.30M	321.50M	-3.30M	-61.60M	4.20M
Balance Sheet
Total Assets	3.90B	4.38B	3.90B	4.75B	4.07B	3.55B
Cash, Cash Equivalents and Short-Term Investments	2.88B	3.13B	2.88B	548.80M	517.70M	432.40M
Total Debt	471.30M	469.30M	471.30M	469.40M	463.60M	348.40M
Total Liabilities	2.39B	2.89B	2.39B	3.48B	2.66B	2.01B
Stockholders Equity	1.51B	1.49B	1.51B	1.27B	1.41B	1.54B
Cash Flow
Free Cash Flow	432.30M	566.40M	425.30M	312.80M	239.90M	80.90M
Operating Cash Flow	441.90M	573.80M	441.90M	323.80M	243.80M	80.90M
Investing Cash Flow	-54.30M	-251.90M	-54.30M	-194.90M	-186.80M	-260.10M
Financing Cash Flow	-185.40M	-386.10M	-185.40M	-90.80M	32.80M	287.30M

Lancashire Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 647.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:LRE, the sentiment is Positive. The current price of 647 is above the 20-day moving average (MA) of 610.80, above the 50-day MA of 613.06, and above the 200-day MA of 590.11, indicating a bullish trend. The MACD of 5.68 indicates Negative momentum. The RSI at 70.65 is Negative, neither overbought nor oversold. The STOCH value of 92.52 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:LRE.

Lancashire Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LRE	79 Outperform	£1.55B	8.51	15.18%	11.98%	8.78%	-38.83%
CRE	76 Outperform	463.19M	42.65	11.95%	9.06%	15.83%	-93.41%
SAGA	65 Neutral	307.72M	-1.88	-285.79%	―	-20.62%	-44.96%
SBRE	65 Neutral	338.23M	8.63	0.00%	4.51%	7.77%	35.65%
VANQ	61 Neutral	274.42M	-3.65	0.00%	―	-3.77%	-147.20%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Lancashire Holdings Corporate Events

Lancashire Holdings Director Increases Shareholding

Bryan Joseph, a Non-Executive Director at Lancashire Holdings, has purchased 1,200 common shares of the company, increasing his total shareholding to 13,446 shares. This transaction, conducted on the London Stock Exchange, reflects a modest increase in insider ownership, potentially signaling confidence in the company’s future performance.

The most recent analyst rating on (GB:LRE) stock is a Buy with a £711.00 price target. To see the full list of analyst forecasts on Lancashire Holdings stock, see the GB:LRE Stock Forecast page.