Employers Holdings Inc. (EIG), the provider of workers’ compensation insurance in the western U.S., rallied today after second-quarter earnings beat analysts’ estimates.
Employers jumped 11 percent to $21.30 at 4:04 p.m. in New York. That narrowed the decline this year to 33 percent for the Reno, Nevada-based insurer.
Chief Executive Officer Douglas Dirks has been seeking to limit losses in California by raising prices and slowing policy count growth, after higher-than-expected claims in 2013. Second-quarter net income increased to $45.6 million, or $1.42 a share, from $14.6 million, or 46 cents, a year earlier, the insurer said yesterday in a statement after the close of regular trading.
“The bull case on the stock calls for stability and improvement in Southern California claim trends,” Amit Kumar, an analyst with Macquarie Capital who has an outperform rating on Employers, said in an investor note. “The stock will react positively on the report.”
Kumar said operating profit, which excludes one-time items and a gain tied to reinsurance, was 27 cents a share, beating his estimate of 22 cents and the average of 21 cents in a Bloomberg survey.
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