W.R. Berkley (NYSE:WRB) shares plummeted first thing Friday, as the commercial lines insurer stock dropped 3% after posting net premiums earned of $2.49 billion in its first quarter. That’s lower than the $2.53 billion expected by analysts, according to consensus expectations from FactSet. The firm also reported operating per-share earnings of $1, lower than $1.10 per share a year ago.
The Company reported strong results for the first quarter of 2023, with continued strong underwriting performance and significant growth in investment income. The annualized return on equity was 17.4% and growth in book value per share, prior to dividends and share repurchases, was 7.2%.
The business continued to grow in areas that we anticipate will meet or exceed our targeted risk-adjusted return. While there is greater evidence that market segments and lines of business are not all moving in lock-step, our structure and discipline enable us to execute on and manage each of these cycles to optimize profitability, even as we maintain a prudent view of loss trends. We continue to carefully evaluate the available opportunities to deploy capital as we selectively expand our business.
Net investment income grew almost 29% during the quarter as an increasingly greater portion of the fixed-maturity portfolio was (re)invested at higher interest rates. “We maintained the short duration,” read this morning’s news release, “and high quality of our fixed-maturity portfolio, given the inverted yield curve and market volatility.”
WRB shares collapsed $6.24, or 9.9%, to $57.12.
