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How Does Intact Financial Corporation Look Ahead of its 3rd-Quarter Earnings?

We are at the start of another earnings season. Let’s take a look at how one financial stock is faring ahead of its upcoming results.

Intact Financial Corporation  (TSX:IFC) is Canada’s largest provider of casualty and property insurance. It also provides specialty insurance across North America. The company currently boasts close to $10 billion in annual premiums. Intact is expected to announce third-quarter results on November 8.

Intact by the numbers

With its last results in August, Intact reported adjusted earnings per share of $1.44, beating analysts’ estimates of $1.34. That also beat 2016’s second-quarter results by a whopping 73.49%.

The stock has a net profit margin of 7.80%, better than many of its competitors. Over the last three years, earnings growth for Intact averaged 8.63% per year, slightly higher than the industry average of 7.83%. Intact has a trailing P/E ratio of 20.46, and it is currently trading just below its 52-week high of $104.33.

A cheap stock, this is not.

Intact’s recent activity

Intact purchased American specialty insurer OneBeacon this year, and the acquisition closed on September 28. This gives the company a chance to see some real growth in the U.S. market. The acquisition should also help with earnings diversification for the company.

What Q3 results might look like

Consensus analyst expectations for Intact’s third-quarter results currently sit $1.53 per share. If they are correct, this would be a gain of over 50% when compared to third quarter 2016. Last year, the stock got weighed down by some bad weather events. Intact hasn’t faced as many payouts due to weather issues thus far in 2017.

Investor takeaway

If you like financial companies but want something beyond the Big Six banks, Intact deserves your attention. It’s not a cheap stock, but it’s been having a good year and has proved to be a solid company. If you are thinking of investing in Intact, be on the lookout for its third-quarter results in November.

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Fool contributor Susan Portelance has no position in any stocks mentioned. Intact Financial is a recommendation of Stock Advisor Canada.

 

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