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1. Company Snapshot

1.a. Company Description

Beazley plc provides risk insurance and reinsurance solutions in the United States, Europe, and internationally.Its Cyber & Executive Risk segment underwrites management liabilities, such as employment practices risks and directors and officers, cyber and technology, and media and business services.The company's Marine segment underwrites various marine classes, including hull, energy, cargo and specie, piracy, satellite, aviation, kidnap and ransom, and war risks.


Its Market Facilities segment underwrites portfolios of businesses.The company's Political, Accident & Contingency segment underwrites terrorism, political violence, expropriation, and credit risks, as well as contingency and risks associated with contract frustration.This segment also underwrites life, health, personal accident, sports, and income protection risks.


Its Property segment provides commercial and homeowners' insurance.The company's Reinsurance segment specializes in writing property catastrophe, property per risk, casualty clash, aggregate excess of loss, and pro-rata businesses.Its Specialty Lines segment underwrites a portfolio of businesses comprising architects and engineers, healthcare, lawyers and environmental liability, market facilities business, and international financial institutions.


The company was founded in 1986 and is based in London, the United Kingdom.

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1.b. Last Insights on BEZ

Beazley plc's recent performance was driven by strong FY 2024 earnings, beating expectations with record profits of over $1.4 billion and an 8.6% revenue increase to $5.54 billion. The company's strategic initiatives, such as launching a $500 million share buyback, demonstrate its commitment to shareholder value. Additionally, Beazley's dividend will increase to $0.25, providing a higher return to shareholders. The company's ability to navigate a competitive insurance landscape, coupled with limited losses from the Los Angeles wildfires, has contributed to its strong performance.

1.c. Company Highlights

2. Beazley's 2025 Interim Results: Solid Performance Amidst Challenging Market Conditions

Beazley's 2025 interim results highlight a profit of $503 million, with an annualized return on equity of over 18% and a combined ratio of 84.9%. The company's focus on specialty insurance, where expertise is applied at the point of sale, has helped maintain decent margins across the cycle. Beazley grew by 2% in the half year, driven by increased competition and underwriting discipline. The company delivered a net income of $0.4764 per share, beating analysts' estimates of $0.4476.

Publication Date: Aug -15

📋 Highlights
  • Profit & ROE:: $503M profit with >18% annualized return on equity, indicating strong operational efficiency.
  • Combined Ratio:: 84.9% overall, with Cyber division at 82.3%, showing disciplined underwriting despite market challenges.
  • Investment Returns:: $300M investment profit (5.4% annualized), driven by a growing portfolio and market performance.
  • Top-Line Growth:: 2% growth in H1, with 5-7% annualized net premium growth in MAP and Europe due to demand for specialty risks.
  • Solvency & Capital:: Maintains 170% Solvency II ratio threshold, with plans to return excess capital via buybacks/dividends.

Underwriting Performance

The company's underwriting performance was strong, with the Cyber portfolio delivering a combined ratio of 82.3% despite a normalization of rates. The MAP division delivered an excellent result, with a combined ratio of 82.4%, driven by strong demand for its products and disciplined underwriting. The Specialty division's combined ratio improved due to changes in the reinsurance contract, and the company remains bearish on social inflation-exposed parties.

Investment Performance

The company's investment portfolio performed well in a volatile market, with a return of 2.7%. The investment income increased 22.6% year-over-year, driven by a growing investment base and a positive contribution from the investment portfolio.

Reserve Development

The company's reserve strength remains consistent, with a risk adjustment percentile of 85%. The company is not seeing any significant developments that would suggest a release of reserves, and they expect to maintain a prudent reserve position.

Capital Strategy

The company's capital strategy is focused on sustainable, profitable growth, and they aim to maintain a minimum threshold for the Solvency Capital Requirement (SCR) of 170%. Excess capital will be distributed to shareholders through share buybacks, special dividends, or a combination of both. As Adrian Peter Cox mentioned, "We expect to provide more details on our capital returns and future growth opportunities at our upcoming Capital Markets Day in November."

Valuation

With a P/E Ratio of 6.29 and a P/B Ratio of 1.54, Beazley's stock appears reasonably valued. The company's ROE of 25.73% and dividend yield of 3.21% suggest a solid fundamentals-based investment opportunity. However, investors should be cautious about the company's exposure to challenging market conditions and the potential for reserve releases.

3. NewsRoom

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Why Analysts See Beazley’s Narrative Shifting as Higher Targets Meet Slower Growth Forecasts

Nov -09

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What Recent Market Moves Mean For Beazley’s Evolving Growth Story

Oct -24

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Beazley First Half 2025 Earnings: Beats Expectations

Aug -15

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AM Best Affirms Credit Ratings of Beazley’s Lloyd’s Syndicates and Beazley plc Subsidiaries

Aug -01

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SiriusPoint names new chief risk officer

Jun -30

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Beazley Insider Ups Holding By 31% During Year

Jun -13

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Beazley plc's (LON:BEZ) Stock Been Rising: Are Strong Financials Guiding The Market?

May -13

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Beazley's (LON:BEZ) Shareholders Will Receive A Bigger Dividend Than Last Year

Mar -08

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.30%)

6. Segments

Specialty Risks

Expected Growth: 7.92%

Beazley's Specialty Risks segment growth of 7.92% is driven by increasing demand for cyber insurance, expansion into new geographies, and a growing need for specialty insurance products in areas such as environmental and political risks. Additionally, the segment benefits from Beazley's expertise in underwriting complex risks and its ability to adapt to changing market conditions.

Cyber Risks

Expected Growth: 14.07%

Beazley plc's 14.07% growth in Cyber Risks is driven by increasing demand for cyber insurance, rising cyber-attacks, and growing regulatory requirements. Additionally, the shift to remote work and digital transformation has heightened cyber risk awareness, leading to increased adoption of cyber insurance products.

Property Risks

Expected Growth: 5.4%

Beazley's 5.4% growth in Property Risks is driven by increasing demand for specialty insurance products, expansion into new geographies, and a growing focus on cyber and environmental risks. Additionally, the insurer's expertise in complex risks, such as construction and energy, has contributed to its growth in this segment.

Marine, Accident and Political Risks

Expected Growth: 4.5%

Beazley's 4.5% growth in Marine, Accident and Political Risks is driven by increasing global trade, rising demand for specialty insurance, and a growing need for political risk coverage in emerging markets. Additionally, the company's expertise in complex risk management and its ability to provide tailored solutions to clients have contributed to its growth in these segments.

Digital

Expected Growth: 13.12%

Beazley's Digital segment growth of 13.12% is driven by increasing demand for cyber insurance, expansion into new markets, and strategic partnerships. The rise of digital transformation and cloud adoption has led to a surge in cyber-attacks, making Beazley's digital insurance products more attractive to clients. Additionally, the company's investments in digital platforms and data analytics have enhanced its underwriting capabilities and improved customer experience.

7. Detailed Products

Cyber Insurance

Beazley's cyber insurance provides comprehensive coverage for businesses against cyber-attacks, data breaches, and other cyber-related risks.

Executive Risk Insurance

Beazley's executive risk insurance provides protection for companies and their directors and officers against legal liability and financial losses.

Marine Insurance

Beazley's marine insurance provides coverage for businesses involved in the transportation of goods by sea, air, or land.

Property Insurance

Beazley's property insurance provides coverage for businesses against damage to their physical assets, such as buildings, equipment, and inventory.

Reinsurance

Beazley's reinsurance provides insurance companies with additional financial protection against large or unexpected losses.

Specialty Lines Insurance

Beazley's specialty lines insurance provides coverage for unique or hard-to-place risks, such as professional liability, environmental liability, and more.

8. Beazley plc's Porter Forces

Forces Ranking

Threat Of Substitutes

Beazley plc operates in the insurance industry, which has a moderate threat of substitutes. While there are alternative insurance providers, Beazley's specialized offerings and strong brand reputation help to mitigate the threat of substitutes.

Bargaining Power Of Customers

Beazley plc's customers are largely comprised of businesses and individuals seeking specialized insurance products. While customers have some bargaining power, Beazley's strong brand reputation and specialized offerings limit the bargaining power of customers.

Bargaining Power Of Suppliers

Beazley plc's suppliers are primarily reinsurance companies and other industry partners. Beazley's strong financial position and diversified supplier base limit the bargaining power of suppliers.

Threat Of New Entrants

The insurance industry has significant barriers to entry, including regulatory hurdles and capital requirements. While new entrants may emerge, Beazley's established brand reputation and specialized offerings make it difficult for new entrants to gain traction.

Intensity Of Rivalry

The insurance industry is highly competitive, with many established players competing for market share. Beazley plc operates in a niche segment, but still faces intense competition from other specialized insurers.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 13.87%
Debt Cost 7.28%
Equity Weight 86.13%
Equity Cost 7.28%
WACC 7.28%
Leverage 16.10%

11. Quality Control: Beazley plc passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Quality: 7.5

Yield: 7.5

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Quality: 6.8

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Beazley

A-Score: 6.5/10

Value: 6.2

Growth: 6.7

Quality: 9.0

Yield: 3.8

Momentum: 7.0

Volatility: 6.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

7.82$

Current Price

7.82$

Potential

-0.00%

Expected Cash-Flows