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Lancashire Holdings Ltd (GB:LRE)
LSE:LRE
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Lancashire Holdings (LRE) AI Stock Analysis

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GB:LRE

Lancashire Holdings

(LSE:LRE)

Rating:83Outperform
Price Target:
711.00p
▲(15.99% Upside)
Lancashire Holdings receives a strong overall score due to its robust financial performance, attractive valuation, and positive earnings call insights. The company's strategic growth initiatives and solid capital position further support its potential. Technical analysis suggests positive momentum, although some caution is warranted due to potential oversold conditions.

Lancashire Holdings (LRE) vs. iShares MSCI United Kingdom ETF (EWC)

Lancashire Holdings Business Overview & Revenue Model

Company DescriptionLancashire Holdings Limited (LRE) is a global specialty insurance and reinsurance provider headquartered in Bermuda. Established in 2005, the company operates primarily in the property, casualty, and marine sectors, offering a range of insurance products and services designed to cover various risks. Lancashire focuses on underwriting and managing risks in the insurance market, utilizing its expertise to provide tailored solutions to clients worldwide. The company aims to maintain a disciplined underwriting approach while delivering value to its shareholders.
How the Company Makes MoneyLancashire 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 Earnings Call Summary

Earnings Call Date:Mar 06, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong financial performance and strategic growth initiatives, with increased profitability and upgraded ROE expectations. However, the company faces challenges from high industry losses and a softening market, which are balanced by their robust capital position and strategic discipline.
Q2-2025 Updates
Positive Updates
Record Q2 Profitability
Q2 2025 was the most profitable second quarter in Lancashire's history, demonstrating the effectiveness of their strategy and resilience to catastrophic losses such as the California wildfires.
Increased ROE Expectations
The company upgraded its ROE expectations to high teens for the 2025 year, assuming similar loss levels as the second half of 2024.
Strong Financial Performance
Insurance revenue increased by 8.9% compared to the first half of 2024, and investment performance was excellent with an overall return of 3.7% for the half year.
Robust Capital Position
Lancashire's solvency remains comfortably above requirements, allowing for selective growth and capital return when excess builds.
Strategic Growth in Specialty Lines
The company continues to expand its specialty reinsurance and U.S. platform, particularly in the energy liability segment.
Negative Updates
High Industry Losses from Natural Catastrophes
The first half of 2025 recorded the highest H1 insured losses since 2011, with Lancashire incurring net catastrophe and weather losses of GBP 172 million.
Increased Operating Expenses
Operating expense ratio increased to 8.8% from 7.8% in 2024, driven by higher employment costs due to additional headcount.
Softening Market Conditions
The insurance market is seeing increased competition, with existing players deploying more capital, although in a disciplined way.
Company Guidance
During the Lancashire Q2 2025 Earnings Conference Call, the company provided an optimistic outlook for the year, upgrading their ROE expectations to the high teens, buoyed by a record-breaking Q2 performance. Despite significant losses from the California wildfires, the company achieved an annualized ROE of 15% and an insurance service result of GBP 156 million, with insurance revenue rising by 8.9% to $930 million compared to the first half of 2024. The combined ratio stood at 97.8%, and investment returns reached 3.7%. The company emphasized disciplined growth amid a competitive market, with a focus on maintaining a robust capital position, evidenced by a BSCR ratio of just over 257%. They noted ongoing market opportunities, particularly in marine, energy, and U.S. liability segments, and highlighted a strategic purchase of additional Lloyd's syndicate capacity, positioning them for future growth without expanding their catastrophe footprint.

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
82
Very Positive
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
75
Positive
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
88
Very Positive
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.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue1.20B1.50B1.25B1.01B751.10M540.80M
Gross Profit1.20B1.50B1.25B1.01B751.10M540.80M
EBITDA-37.10M371.30M364.50M12.40M-42.90M26.20M
Net Income321.50M321.30M321.50M-3.30M-61.60M4.20M
Balance Sheet
Total Assets3.90B4.38B3.90B4.75B4.07B3.55B
Cash, Cash Equivalents and Short-Term Investments2.88B3.13B2.88B548.80M517.70M432.40M
Total Debt471.30M469.30M471.30M469.40M463.60M348.40M
Total Liabilities2.39B2.89B2.39B3.48B2.66B2.01B
Stockholders Equity1.51B1.49B1.51B1.27B1.41B1.54B
Cash Flow
Free Cash Flow432.30M566.40M425.30M312.80M239.90M80.90M
Operating Cash Flow441.90M573.80M441.90M323.80M243.80M80.90M
Investing Cash Flow-54.30M-251.90M-54.30M-194.90M-186.80M-260.10M
Financing Cash Flow-185.40M-386.10M-185.40M-90.80M32.80M287.30M

Lancashire Holdings Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price613.00
Price Trends
50DMA
602.17
Positive
100DMA
586.45
Positive
200DMA
588.27
Positive
Market Momentum
MACD
2.56
Positive
RSI
49.65
Neutral
STOCH
42.64
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:LRE, the sentiment is Neutral. The current price of 613 is below the 20-day moving average (MA) of 618.19, above the 50-day MA of 602.17, and above the 200-day MA of 588.27, indicating a neutral trend. The MACD of 2.56 indicates Positive momentum. The RSI at 49.65 is Neutral, neither overbought nor oversold. The STOCH value of 42.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GB:LRE.

Lancashire Holdings Peers Comparison

Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
83
Outperform
£1.50B8.3215.18%12.33%8.78%-38.83%
76
Outperform
£461.63M42.511.39%9.04%15.83%-93.41%
68
Neutral
$17.89B12.0310.28%3.73%9.80%1.66%
£153.81M8.4113.74%2.79%
65
Neutral
£310.57M-127.10%-20.62%-44.96%
65
Neutral
£354.40M9.0116.39%4.38%7.77%35.65%
61
Neutral
£292.18M-16.30%9.29%-3.77%-147.20%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:LRE
Lancashire Holdings
613.00
39.46
6.88%
GB:HUW
Helios Underwriting
215.00
49.15
29.64%
GB:VANQ
Vanquis Banking Group
116.20
58.20
100.34%
GB:SAGA
Saga plc
216.50
110.50
104.25%
GB:SBRE
Sabre Insurance Group plc
143.40
8.76
6.51%
GB:CRE
Conduit Holdings Ltd
300.50
-183.63
-37.93%

Lancashire Holdings Corporate Events

Business Operations and StrategyFinancial Disclosures
Lancashire Holdings Reports Strong H1 2025 Results Amid Challenging Market
Positive
Aug 6, 2025

Lancashire Holdings Limited reported a strong profit after tax of $109.2 million for the first half of 2025, demonstrating increased resilience in its business model. The company saw a 5.8% increase in gross premiums written and an 8.9% rise in insurance revenue year-on-year. Despite the challenging loss environment, including significant losses from the California wildfires, Lancashire maintained a healthy combined ratio and investment return. The company expects a high-teens return on equity for 2025, reflecting its strategic growth and disciplined underwriting approach. Lancashire’s robust balance sheet and capital base support its growth and shareholder returns, positioning it well in a competitive market.

The most recent analyst rating on (GB:LRE) stock is a Buy with a £7.09 price target. To see the full list of analyst forecasts on Lancashire Holdings stock, see the GB:LRE Stock Forecast page.

Financial Disclosures
Lancashire Holdings to Announce 2025 Half-Year Results
Neutral
Jun 25, 2025

Lancashire Holdings Limited announced it will release its 2025 half-year results on August 6, 2025, followed by an analyst and investor conference call. This announcement is significant as it provides stakeholders with insights into the company’s financial performance and strategic positioning in the specialty insurance and reinsurance market.

The most recent analyst rating on (GB:LRE) stock is a Buy with a £7.09 price target. To see the full list of analyst forecasts on Lancashire Holdings stock, see the GB:LRE Stock Forecast page.

Business Operations and StrategyRegulatory Filings and Compliance
BlackRock Adjusts Stake in Lancashire Holdings
Neutral
Jun 25, 2025

Lancashire Holdings Limited, a non-UK issuer, has been involved in a significant change in its voting rights structure due to an acquisition or disposal by BlackRock, Inc., a major asset management firm based in the USA. As of June 20, 2025, BlackRock’s total voting rights in Lancashire Holdings have slightly decreased to 4.96%, down from a previous position of 5.00%. This change reflects a minor adjustment in BlackRock’s investment strategy, which could have implications for its influence over the company’s decisions.

The most recent analyst rating on (GB:LRE) stock is a Buy with a £7.09 price target. To see the full list of analyst forecasts on Lancashire Holdings stock, see the GB:LRE Stock Forecast page.

Regulatory Filings and Compliance
Lancashire Holdings Director Increases Shareholding
Positive
Jun 18, 2025

Lancashire Holdings Limited, a company operating in the insurance sector, announced a transaction involving Sally Williams, a Non-Executive Director and Chair of the Audit Committee. On June 17, 2025, Williams purchased 868 common shares of the company, increasing her total shareholding to 11,950 shares, which represents 0.0049% of the company’s total voting rights. This transaction, disclosed in accordance with UK MAR requirements, reflects a personal investment by a key figure in the company’s governance, potentially signaling confidence in the company’s future prospects.

The most recent analyst rating on (GB:LRE) stock is a Buy with a £7.09 price target. To see the full list of analyst forecasts on Lancashire Holdings stock, see the GB:LRE Stock Forecast page.

Business Operations and StrategyRegulatory Filings and Compliance
BlackRock Increases Stake in Lancashire Holdings to 5%
Neutral
May 30, 2025

Lancashire Holdings Limited, a non-UK issuer, has seen a change in its voting rights structure due to an acquisition or disposal by BlackRock, Inc., a major shareholder based in Wilmington, USA. This notification indicates that BlackRock’s total voting rights in Lancashire Holdings have increased to 5.00%, up from a previous position of 4.36%. This change in voting rights could potentially impact Lancashire Holdings’ governance and decision-making processes, as BlackRock holds a significant influence over the company’s strategic direction.

The most recent analyst rating on (GB:LRE) stock is a Buy with a £7.09 price target. To see the full list of analyst forecasts on Lancashire Holdings stock, see the GB:LRE Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Aug 19, 2025