What Happened?
Shares of global reinsurance company Everest Group (NYSE: EG) fell 9.7% in the afternoon session after it reported disappointing third-quarter 2025 results that fell short of Wall Street's expectations on several key metrics.
The company's GAAP earnings per share came in at $6.09, missing consensus estimates of $15.18 by nearly 60% and declining sharply from $11.81 in the same period last year. Revenue was flat year-over-year at $4.32 billion, also failing to meet the $4.43 billion forecast. A significant drag on profitability was the company's underwriting performance, as its combined ratio worsened to 103%. A ratio above 100% indicates an underwriting loss, meaning the company paid out more in claims and expenses than it collected in premiums. Furthermore, net premiums earned, a core component of its business, declined 1.6% year-on-year to $3.86 billion, also missing analysts' projections.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Everest Group? Access our full analysis report here.
What Is The Market Telling Us
Everest Group’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was about 1 month ago when the stock dropped 2.5% on the news that Wolfe Research initiated coverage on the stock with an 'Underperform' rating. The research firm's analyst, Tracy Benguigui, set a price target of $287 for the company. An "Underperform" rating indicates that the analyst expects the stock to perform worse than the broader market or its industry peers. This initial assessment from a new covering analyst can significantly influence investor sentiment, as it provides a fresh, and in this case pessimistic, perspective on the company's future prospects, likely prompting some investors to sell their shares.
Everest Group is down 15.4% since the beginning of the year, and at $307.23 per share, it is trading 21.2% below its 52-week high of $390.10 from November 2024. Investors who bought $1,000 worth of Everest Group’s shares 5 years ago would now be looking at an investment worth $1,566.
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