QBE (ASX:QBE) Shares Signal Value After Strong Underwriting First Half

QBE Insurance Group walked into this result with the stock drifting, down about 5% over the past week and 7% over the month, yet trading on a modest P/E of 11.3x. The earnings print then delivered a different message. Return on equity of 17.7% and a statutory combined ratio of 87.8% point to a core underwriting machine that appears stronger than the share price suggests.

For an investor, the sentiment shift is clear. The market has been marking QBE lower while the latest half shows solid profitability and a capital position that supported a higher interim dividend.

Is QBE Insurance Group on sale at an 11.3x P/E and a share price well below the supplied DCF value, or is the forecast earnings decline already fair? See how the current valuation stacks up in our valuation analysis for QBE Insurance Group.

H1 2026 Earnings Summary

• Revenue (H1 2026 vs H1 2025): US$9,636m vs. US$8,900m (up 8.3%)
• Net Income (H1 2026 vs H1 2025): US$1,033m vs. US$997m (up 3.6%)
• Basic EPS (H1 2026 vs H1 2025): US$0.689 vs. US$0.661 (up 4.2%)
• Statutory Combined Ratio (H1 2026 vs H1 2025): 87.8% vs. 88.3% (improved by 0.5 percentage points)

Prefer clear charts instead of scrolling through more earnings figures and ratios? See QBE Insurance Group's full valuation picture presented in an easy visual dashboard with our company report for QBE Insurance Group.

QBE Bull Case Hinge: Quality Growth With Tighter Risk

The bullish view on QBE Insurance Group centers on higher quality premium growth, stronger underwriting economics and better use of third party capital instead of simple volume expansion. H1 2026 goes a fair way to backing that up. Group GWP rose mid single digit while the statutory combined ratio sat at 87.8% and the reported combined ratio of 92.8% remained in line with full year guidance. That shows growth without obvious slippage in underwriting discipline.

Several claimed catalysts are now visible in the numbers. QBE Re has expanded to about 15% of group GWP and now includes a casualty sidecar and a cat bond program, which supports the argument that more risk is being recycled to external capital. Catastrophe exposure looks more controlled with probable maximum loss down about 11% since 2023 and maximum event retention down about 40% while premium has grown. That is consistent with the bull case emphasis on more capital efficient growth rather than pure leverage to catastrophe cycles.

Access the full earnings forecast path to see where the consensus breaks and what the street is secretly modeling for QBE Insurance Group over the next few years with the analyst estimates for QBE Insurance Group.

QBE Bear Case: Cat, Costs and Complexity Under the Microscope

The bearish view on QBE Insurance Group is that catastrophe heavy books, a sticky expense base and complex reinsurance structures could cap margins and keep returns fragile. This result only partly clears that hurdle. Cat exposure looks better controlled, with probable maximum loss and maximum event retention both lower while group gross written premium is higher, which runs against fears of unchecked cat leverage.

However, the expense narrative has not flipped. The H1 expense ratio of 12.4% is above the prior 12.1% and management is still talking about an H2 improvement rather than reporting it already. That is a milestone missed for those waiting for clear cost traction. The push into reinsurance, portfolio solutions and newer risks like cyber and energy transition remains complex, and while performance is solid, there is not yet enough cycle or loss history here to disprove concerns about model risk and future large loss volatility.

After rising costs, complex reinsurance and an unstable dividend record, is this just surface risk? Review our completed risk analysis for QBE Insurance Group which shows 2 important warning signs

Power Up Your Next Move

If QBE Insurance Group’s mix of solid underwriting metrics and an 11.3x P/E has caught your eye, register for free with Simply Wall St and add it to a Watchlist to track share price against fair value and watch how new results reshape the thesis. Once you decide to take a position, use the Portfolio Command Center to cut through day to day noise and focus on the most important updates to your holdings. For the longer term, tap into thousands of investor views through the Community and see how others are thinking about catalysts such as capital returns, reinsurance use and expense trends. By spotting potential shifts in risks and opportunities early, you give yourself a better chance to stay ahead of the market.

Seeking Alternatives Beyond QBE Insurance Group

Fresh opportunities can move from quiet to breakout quickly, and the best entry points often pass before the crowd wakes up. Scan these ideas while it matters and get in early.

• Spot income workhorses with yields that could steady your portfolio and keep cashflow flying using a curated set of 4 dividend fortresses before others chase the payouts.
• Track potential future infrastructure candidates in areas such as AI-related demand and grid upgrades through hand picked 38 power grid technology and infrastructure stocks while they are still under the radar for now.
• Hunt for resilient growth stories where AI-linked profits already appear in reported results with carefully filtered 76 profitable AI stocks that aren't just burning cash and review them before any momentum becomes widely reflected in prices.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com