On Apr 10, 2013, we upgraded
Everest Re Group, Ltd.
) to Outperform from Neutral on the back of its improved
underwriting performance in the recent quarters, which will lead
the company to report better than expected results in the
upcoming quarters. This property and casualty insurer carries a
Zacks Rank #1 (Strong Buy).
Why the Upgrade?
Everest Re's U.S. Reinsurance segment has been performing
quite well recently. Management continues to reduce the casualty
business to focus on underwriting profit. The company has been
witnessing hikes in renewal rates in the property lines business.
Thus, we expect meaningful rate increases, particularly in the
regions mostly affected by catastrophes.
Everest Re realigned its insurance segment to emerge in those
businesses that would allow a meaningful and sustainable
Everest Re has grown its business in the Middle East, Latin
America and Asia. Rate increases, beginning last year in Latin
America and continuing into this year in Australia, New Zealand
and Japan, are likely to lead to more positive results. We have
noticed that much of the company's top-line growth in the past
few years has been generated from its overseas business and the
trend is expected to continue in the future.
We expect Everest Re to benefit from its capital adequacy,
financial flexibility, good long-term operating performance and
traditional risk management capabilities.
Over the last 60 days, 6 of 10 estimates moved north pushing
the Zacks Consensus Estimate for 2013 to $14.16 by 4.3%.
Also 3 of 10 estimates were raised for 2014 to $15.09 by
2.7% over the same time frame.
Cincinnati Financial Corp.
Arch Capital Group Ltd.
), among other property and casualty insurer, are, carrying Zacks
Rank #1 (Strong Buy) and are worth considering.
ARCH CAP GP LTD (ACGL): Free Stock Analysis
CHUBB CORP (CB): Free Stock Analysis Report
CINCINNATI FINL (CINF): Free Stock Analysis
EVEREST RE LTD (RE): Free Stock Analysis
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