As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q2. Today, we are looking at property & casualty insurance stocks, starting with Fidelity National Financial (NYSE: FNF).

Property & Casualty (P&C) insurers protect individuals and businesses against financial loss from damage to property or from legal liability. This is a cyclical industry, and the sector benefits when there is 'hard market', characterized by strong premium rate increases that outpace loss and cost inflation, resulting in robust underwriting margins. The opposite is true in a 'soft market'. Interest rates also matter, as they determine the yields earned on fixed-income portfolios. On the other hand, P&C insurers face a major secular headwind from the increasing frequency and severity of catastrophe losses due to climate change. Furthermore, the liability side of the business is pressured by 'social inflation'—the trend of rising litigation costs and larger jury awards.

The 33 property & casualty insurance stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 1.5%.

Thankfully, share prices of the companies have been resilient as they are up 5.4% on average since the latest earnings results.

Fidelity National Financial (NYSE: FNF)

Issuing more title insurance policies than any other company in the United States, Fidelity National Financial (NYSE: FNF) provides title insurance and escrow services for real estate transactions while also offering annuities and life insurance through its F&G subsidiary.

Fidelity National Financial reported revenues of $3.64 billion, up 15.1% year on year. This print exceeded analysts’ expectations by 2.7%. Despite the top-line beat, it was still a softer quarter for the company with a significant miss of analysts’ EPS estimates.

Chris Blunt, F&G's Chief Executive Officer, said, "We grew AUM before flow reinsurance to $69.2 billion at the end of the second quarter, an increase of 13% from second quarter 2024, driven by strong sales. Our standalone business is benefiting from increased scale, as our ratio of operating expense to AUM before flow reinsurance has decreased by 5 basis points from the second quarter of 2024, and we expect further improvement in the second half of the year. Our high quality investment portfolio is performing well and credit related impairments remain below our pricing assumption. Overall, we have had tremendous growth since FNF acquired F&G in June 2020, with a cumulative 58% increase in book value per share excluding AOCI since year-end 2020, to $43.39 at the end of the second quarter."

Interestingly, the stock is up 5% since reporting and currently trades at $61.07.

Read our full report on Fidelity National Financial here, it’s free.

Best Q2: Root (NASDAQ: ROOT)

Pioneering a data-driven approach that rewards good driving habits, Root (NASDAQ: ROOT) is a technology-driven auto insurance company that uses mobile apps to acquire customers and data science to price policies based on individual driving behavior.

Root reported revenues of $382.9 million, up 32.4% year on year, outperforming analysts’ expectations by 7.5%. The business had an incredible quarter with a beat of analysts’ EPS estimates and a solid beat of analysts’ net premiums earned estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 24.9% since reporting. It currently trades at $92.41.

Is now the time to buy Root? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Selective Insurance Group (NASDAQ: SIGI)

Founded in 1926 during the early days of automobile insurance, Selective Insurance Group (NASDAQ: SIGI) is a property and casualty insurance company that sells commercial, personal, and excess and surplus lines insurance products through independent agents.

Selective Insurance Group reported revenues of $127.9 million, down 89.3% year on year, falling short of analysts’ expectations by 90.3%. It was a disappointing quarter as it posted a significant miss of analysts’ EPS estimates and a significant miss of analysts’ book value per share estimates.

Selective Insurance Group delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 11.6% since the results and currently trades at $79.99.

Read our full analysis of Selective Insurance Group’s results here.

Markel Group (NYSE: MKL)

Often referred to as a "mini Berkshire Hathaway" for its three-engine business model of insurance, investments, and wholly-owned businesses, Markel Group (NYSE: MKL) is a specialty insurance company that underwrites complex risks, manages investment portfolios, and owns a diverse collection of operating businesses.

Markel Group reported revenues of $4.60 billion, up 24.3% year on year. This print topped analysts’ expectations by 15.7%. Zooming out, it was a satisfactory quarter as it also recorded a solid beat of analysts’ net premiums earned estimates but a slight miss of analysts’ book value per share estimates.

The stock is down 2.1% since reporting and currently trades at $1,963.

Read our full, actionable report on Markel Group here, it’s free.

Kinsale Capital Group (NYSE: KNSL)

Founded in 2009 during the aftermath of the financial crisis when many insurers were retreating from riskier markets, Kinsale Capital Group (NYSE: KNSL) is an insurance company that specializes in writing policies for hard-to-place, unusual, or high-risk businesses that standard insurers typically avoid.

Kinsale Capital Group reported revenues of $469.8 million, up 22.2% year on year. This number beat analysts’ expectations by 8.2%. Aside from that, it was a satisfactory quarter as it also logged a solid beat of analysts’ net premiums earned estimates but a slight miss of analysts’ book value per share estimates.

The stock is down 4.1% since reporting and currently trades at $453.21.

Read our full, actionable report on Kinsale Capital Group here, it’s free.

Market Update

The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.

Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Growth Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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