Daily Insurance Industry News
 
 
Daily Insurance Industry News
Saturday 20th of January 2018
October 31, 2008

Hartford stock price nosedives

by David Masters

Story link: Hartford stock price nosedives

The value of Hartford Financial Services Group was slashed in half yesterday after the company posted its results for the third quarter.

After hearing of the $2.6 billion quarterly loss investors began to fear that the company would need to raise capital and may have trouble doing so.

Hartford’s stock plummeted to a twelve month low of $9.62 per share as investors fled the embattled insurer. This is 90% lower than levels of one year-ago.

Analysts said the plunge in stock price was not because of the quarterly loss, but because Hartford management could not give a straight answer on how much capital the company would need to see it through the credit crisis.

Investors get concerned when companies are forced to raise capital because they often do so by selling extra stock, diluting the value of current shares.

The company blames the heavy third quarter loss on tumultuous investment markets and high catastrophe payouts.

Chairman and CEO Ramani Ayer said it had been an ‘extremely difficult quarter’ with volatile credit markets and the largest catastrophe for three years.

He added that the company is ‘financially strong’ and has the capital necessary to meet its commitments to customers.

Chief Financial Officer Liz Zlatkus added that Hartford is comfortable with its current level of capital.

Hartford, whose revenues exceeded $25 billion in 2007, is a Fortune 100 company with 198 years of history.

The company provides life insurance, automobile and home insurance, business property and casualty insurance, group benefits, and investment products.

It has international operations in Ireland, Brazil, Japan and the United Kingdom.

 

News posted:



Related stories to Hartford stock price nosedives: