Allied World Assurance Company Holdings, AG
) announced that Allied World Assurance Holdings (Ireland) Ltd.
had inked a deal with Gravity Underwriting Limited (Gravity). Per
the agreement, the former will invest as well as own 21.2% stake
of the latter.
ALLIED WORLD AS (AWH): Free Stock Analysis
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London-based Gravity Underwriting Limited is a provider of a
suite of property and casualty products for insurance brokers in
the U.K. SME market. The transaction will help Allied World to
strengthen its European footprint.
The agreement also requires that Gravity Underwriting augment
Allied World Europe's property book of business.
In order to grow inorganically, Allied World Financial Services
Company Inc., a subsidiary of Allied World, entered into a
partnership with MatlinPatterson in Oct 2012. The partnership was
intended to expand Allied World's asset management business.
Additionally, the transaction will entail the company to hold a
minority interest in MatlinPatterson. While Allied World will
financially support expansion of asset management platform,
MatlinPatterson will be responsible for managing $500 million of
Allied World's portfolio in existing and future liquid credit
The company also remains focus on other strategic avenues that
ensure a stable revenue flow for the company. Last month, Allied
World Bermuda launched a new Accountable Care Organization (ACO)
liability solution product that will provide coverage for
ACOs. It also launched Allied WorldWide, to cater to the
insurance coverage needs of international clients.
In the last reported quarter, the property and casualty insurer
delivered earnings of $2.94 per share, surpassing the Zacks
Consensus estimate by nearly 69% and year-ago earnings by 23%. We
expect continued initiatives undertaken by the company will help
it to ramp up its growth profile. The Zacks Consensus Estimate
for 2013 is currently pegged at $8.44 per share, translating to a
year-over-year increase of 55%. The long-term expected earnings
growth rate for this stock is 11.1%.
Allied World carries a Zacks Rank #2 (Buy). Property and casualty
Everest Re Group Ltd
Global Indemnity plc
HCI Group, Inc
), among others, carry a favorable Zacks Rank #1 (Strong Buy) and
are also worth considering.