Earnings Analysis November 2, 2026

Loews Corp ($L) Q3 FY2026 Earnings Analysis: Net Income Down 39% Due to Long-Term Care Reserve Provision

Earnings Report

Revenue: $4.759 billion (Q3 FY2026, +1.9% compared to $4.671 billion in the same period last year) · Judgment against expectations pending due to unconfirmed consensus

EPS (Earnings Per Share): $1.50 (Q3 FY2026, compared to $2.43 in the same period last year) · Judgment against expectations pending due to unconfirmed consensus

Guidance: Not provided · Did not release outlook for the next quarter or the full year

Stock Price Reaction: -0.33% during regular trading ($111.32, as of 05:00 Oct 31, Korea time)

What Went Well

Loews Hotels: Adjusted EBITDA increased by 25% year-over-year to $86 million

Boardwalk Pipelines: Profits increased year-over-year when excluding one-time costs of $19 million

Book Value Per Share: Book value per share, excluding the valuation of available-for-sale securities, rose to $100.67

Loews Hotels saw improved performance as the completion of the Miami Beach hotel renovation and Arlington assets drove up occupancy rates and Average Daily Rate (ADR). Boardwalk achieved profit improvement excluding costs due to rising gas transportation contract rates and utilization. Loews defended per-share value by repurchasing $167 million worth of its own shares in the third quarter.

What Went Poorly

CNA Financial: Net income decreased to $180 million as $125 million was set aside for long-term care reserves

Property & Casualty Insurance: The combined ratio rose 4.2 points to 97.0%, and the underlying loss ratio also increased to 64.1%

Consolidated Earnings: Net income attributable to common shareholders decreased by 39% year-over-year to $306 million

CNA's core earnings fell by more than half as the recalculation of long-term care insurance reserves coincided with catastrophe losses. The company stated it would offset this burden with investment income, but it will take time to reflect this. A decrease in returns from the corporate investment portfolio also dragged down consolidated earnings.

What the Company Said

The company stated that the $125 million burden from long-term care reserves will be almost offset by increased investment income arising from recent investment adjustments. It explained that Boardwalk improved year-over-year excluding one-time items, and the hotel segment's performance improved due to rising room rates and occupancy rates.

Market Reaction and Future Key Points

Earnings were released before the market opened, and the confirmed stock price figures are based on the previous regular session close. The fact that most of the net income decrease stemmed from insurance reserve provisions is the key variable in the stock price reaction after the opening.

A point to monitor is whether CNA's long-term care reserve provisions are actually offset by investment income after the fourth quarter.

It remains to be seen whether the non-life insurance combined ratio stays below 100% and whether catastrophe losses increase again.

It is necessary to observe whether Boardwalk Gas transmission unit costs and the pace of share buybacks support per-share value.