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Mercury General (MCY)

Mercury General Corporation and its subsidiaries are a multiple line insurance organization offering predominantly personal automobile and homeowners insurance through a network of independent producers in many states.

Company profile

Ticker
MCY
Exchange
CEO
Gabriel Tirador
Employees
Incorporated
Location
Fiscal year end
SEC CIK
Subsidiaries
Mercury Casualty Company • Mercury Insurance Company • Mercury Indemnity Company • California Automobile Insurance Company • California General Underwriters Insurance Company, Inc. • Mercury Insurance Services LLC • Mercury County Mutual Insurance Company • American Mercury Insurance Company • American Mercury Lloyds Insurance Company • Mercury Select Management Company, Inc. ...
IRS number
952211612

MCY stock data

Calendar

2 Aug 22
12 Aug 22
31 Dec 22
Quarter (USD) Jun 22 Mar 22 Dec 21 Sep 21
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD) Dec 21 Dec 20 Dec 19 Dec 18
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Date Owner Security Transaction Code Indirect 10b5-1 $Price #Shares $Value #Remaining
19 May 22 Joshua Eric Little Common Stock Buy Acquire P No No 47.3304 100 4.73K 2,100
5 May 22 Theodore R Stalick Common Stock Gift Dispose G No No 52.35 70 3.66K 4,443
4 Mar 22 George Joseph Common Stock Other Dispose J Yes No 54.07 110 5.95K 644
18 Feb 22 Theodore R Stalick Common Stock Payment of exercise Dispose F No No 55 2,161 118.86K 4,513
18 Feb 22 Theodore R Stalick Common Stock Option exercise Acquire M No No 43.01 2,500 107.53K 6,674
18 Feb 22 Theodore R Stalick Common Stock Common Stock Option exercise Dispose M No No 43.01 2,500 107.53K 0
41.0% owned by funds/institutions
13F holders Current Prev Q Change
Total holders 243 253 -4.0%
Opened positions 36 34 +5.9%
Closed positions 46 27 +70.4%
Increased positions 96 87 +10.3%
Reduced positions 74 92 -19.6%
13F shares Current Prev Q Change
Total value 1.25B 1.23B +0.9%
Total shares 22.69M 23.24M -2.4%
Total puts 43.1K 66.6K -35.3%
Total calls 48.2K 104K -53.7%
Total put/call ratio 0.9 0.6 +39.6%
Largest owners Shares Value Change
Vanguard 2.65M $145.76M +1.1%
BLK Blackrock 2.53M $139.4M +5.3%
Dimensional Fund Advisors 1.45M $79.71M +0.7%
Renaissance Technologies 1.36M $74.77M -9.1%
IVZ Invesco 1.32M $72.52M +4.0%
STT State Street 1.27M $70.11M +20.8%
CAIBX Capital Income Builder 1.1M $58.78M 0.0%
GS Goldman Sachs 812.89K $44.71M -7.4%
First Trust Advisors 714.31K $39.29M +9.8%
BK Bank Of New York Mellon 600.52K $33.03M +1.7%
Largest transactions Shares Bought/sold Change
Y Alleghany 0 -385.7K EXIT
Norges Bank 0 -256.48K EXIT
STT State Street 1.27M +219.72K +20.8%
Allspring Global Investments 206.4K -136.89K -39.9%
Renaissance Technologies 1.36M -136K -9.1%
BLK Blackrock 2.53M +126.51K +5.3%
Alliancebernstein 161.06K +117.47K +269.5%
Millennium Management 114.33K +114.33K NEW
Jacobs Levy Equity Management 5.09K -98.3K -95.1%
Aqr Capital Management 332.46K -80.47K -19.5%

Financial report summary

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Competition
National General
Risks
  • The Company remains highly dependent upon California to produce revenues and operating profits.
  • Mercury General is a holding company that relies on regulated subsidiaries for cash flows to satisfy its obligations.
  • The Insurance Companies are subject to minimum capital and surplus requirements, and any failure to meet these requirements could subject the Insurance Companies to regulatory action.
  • The Company’s success depends on its ability to accurately underwrite risks and to charge adequate premiums to policyholders.
  • The Company’s insurance rates are subject to approval by the departments of insurance in most of the states in which the Company operates, and to political influences.
  • The effects of emerging claim and coverage issues on the Company’s business are uncertain and may have an adverse effect on the Company’s business.
  • Loss of, or significant restriction on, the use of credit scoring in the pricing and underwriting of personal lines products could reduce the Company’s future profitability.
  • If the Company cannot maintain its A.M. Best ratings, it may not be able to maintain premium volume in its insurance operations sufficient to attain the Company’s financial performance goals.
  • The Company may require additional capital in the future, which may not be available or may only be available on unfavorable terms.
  • Changes in market interest rates, defaults on securities and tax considerations may have an adverse effect on the Company’s investment portfolio, which may adversely affect the Company’s financial results.
  • Changes in the financial strength ratings of financial guaranty insurers issuing policies on bonds held in the Company’s investment portfolio may have an adverse effect on the Company’s investment results.
  • Deterioration of the municipal bond market in general or of specific municipal bonds held by the Company may result in a material adverse effect on the Company’s financial condition, results of operations, and liquidity.
  • If the Company’s loss reserves are inadequate, its business and financial position could be harmed.
  • There is uncertainty involved in the availability of reinsurance and the collectability of reinsurance recoverable.
  • The failure of any loss limitation methods employed by the Company could have a material adverse effect on its financial condition or results of operations.
  • The Company’s business is vulnerable to significant catastrophic property loss, which could have an adverse effect on its financial condition and results of operations.
  • The Company depends on independent agents who may discontinue sales of its policies at any time.
  • The Company’s expansion plans may adversely affect its future profitability.
  • Any inability of the Company to realize its deferred tax assets, if and when they arise, may have a material adverse effect on the Company’s financial condition and results of operations.
  • Uncertain economic conditions may negatively affect the Company’s business and operating results.
  • The private passenger automobile insurance industry is highly competitive, and the Company may not be able to compete effectively against larger or better-capitalized companies.
  • The Company may be adversely affected by changes in the private passenger automobile insurance industry.
  • The Company cannot predict the impact that changing climate conditions, including legal, regulatory and social responses thereto, may have on its business.
  • Changes in federal or state tax laws could adversely affect the Company’s business, financial condition, results of operations, and liquidity.
  • The insurance industry is subject to extensive regulation, which may affect the Company’s ability to execute its business plan and grow its business.
  • Regulation may become more restrictive in the future, which may adversely affect the Company’s business, financial condition, and results of operations.
  • Assessments and other surcharges for guaranty funds, second-injury funds, catastrophe funds, and other mandatory pooling arrangements may reduce the Company’s profitability.
  • The insurance industry faces litigation risks, which, if resolved unfavorably, could result in substantial penalties and/or monetary damages, including punitive damages. In addition, insurance companies incur material expenses defending litigation and their results of operations or financial condition could be adversely affected if they fail to accurately project litigation expenses.
  • The Company relies on its information technology systems to manage many aspects of its business, and any failure of these systems to function properly or any interruption in their operation could result in a material adverse effect on the Company’s business, financial condition, and results of operations.
  • Pandemics, epidemics, widespread health emergencies, or outbreaks of infectious diseases could disrupt the Company's business and adversely affect its results of operations and financial condition.
  • The Company is controlled by a small number of shareholders who will be able to exert significant influence over matters requiring shareholder approval, including change of control transactions.
  • Future equity or debt financing may affect the market price of the Company’s common stock and rights of the current shareholders, and the future exercise of options and granting of shares will result in dilution in the investment of the Company’s shareholders.
  • Applicable insurance laws may make it difficult to effect a change of control of the Company or the sale of any of its Insurance Companies.
  • Although the Company has consistently paid increasing cash dividends in the past, it may not be able to pay or continue to increase cash dividends in the future.
  • Changes in accounting standards issued by the Financial Accounting Standards Board (the "FASB") or other standard-setting bodies may adversely affect the Company’s consolidated financial statements.
  • The Company’s disclosure controls and procedures may not prevent or detect acts of fraud.
  • Failure to maintain an effective system of internal control over financial reporting may have an adverse effect on the Company’s stock price.
  • The ability of the Company to attract, develop and retain talented employees, managers and executives, and to maintain appropriate staffing levels, is critical to the Company’s success.
Management Discussion
  • Net premiums earned and net premiums written for the three months ended June 30, 2022 increased 6.5% and 6.2%, respectively, from the corresponding period in 2021. The increase in net premiums earned and net premiums written for the three months ended June 30, 2022 compared to the corresponding period in 2021 was primarily due to higher average premiums per policy arising from rate increases in the California homeowners line of insurance business and increases in the number of policies written outside of California, partially offset by a decrease in the number of private passenger automobile policies written in California.
  • Net premiums earned included ceded premiums earned of $17.1 million and $15.6 million for the three months ended June 30, 2022 and 2021, respectively. Net premiums written included ceded premiums written of $17.4 million and $15.8 million for the three months ended June 30, 2022 and 2021, respectively. The increase in ceded premiums earned and ceded premiums written for the three months ended June 30, 2022 compared to the corresponding period in 2021 resulted mostly from higher reinsurance coverage and rates and growth in the covered book of business.
  • Net premiums earned, a GAAP measure, represents the portion of net premiums written that is recognized as revenue in the financial statements for the periods presented and earned on a pro-rata basis over the term of the policies. Net premiums written is a non-GAAP financial measure which represents the premiums charged on policies issued during a fiscal period, net of any applicable reinsurance. Net premiums written is a statutory measure designed to determine production levels.

Content analysis

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Positive
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Legalese
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Readability
H.S. sophomore Bad
New words: challenging, conflict, extraordinarily, geopolitical, hail, military, protracted, Russia, seed, Ukraine, upper, venture, warrant
Removed: April, congested, top