On Jul 8, 2014, shares of
Everest Re Group Ltd.
) reached a new 52-week high of $163.80. Over the past one year,
the stock price of this Zacks Rank #3 (Hold) stock has soared,
thanks to the company's effective capital deployment and strong
The shares gained 31% in the one-year period to close at $163.61 in
the last trading session. Moreover, Everest Re's one-year return of
27.53% was higher than the S&P 500's return of 20.32% and that
of the other industry players like
RenaissanceRe Holdings Ltd.
Montpelier Re Holdings Ltd.
) that recorded returns of 24.66%, 23.96% and 20.21% respectively.
Over the past one year, Everest Re has undertaken significant
capital deployment initiatives that reflect the company's financial
strength and at the same time, its incessant efforts to boost
shareholders' worth. In the second quarter last year, the company
amended the existing share repurchase program to purchase up to 25
million shares from 20 million authorized earlier. Everest Re's
strong financial position has enabled it to realize this goal and
the company had successfully completed the buyback of 22.1 million
shares till the last reported quarter, under this authorization.
Everest Re's efficient capital management is also evident from its
continuous dividend payouts. In Nov 2013, the company increased its
quarterly cash dividend by 56% to 75 cents per share from 48 cents
per share paid earlier. Moreover, continuing its steady dividend
payouts, Everest Re disbursed its quarterly dividend of 75 cents on
Jun 18, 2014.
The current dividend yield of the company is 1.83%, better than
other players like Montpelier and RenaissanceRe that have a yield
of 1.55% and 1.08% respectively. Further, with cash flow increasing
by 42% to $367.1 million in the first quarter, there is still much
upside left with respect to its capital deployment programs.
Earlier, the company reported first-quarter 2014 earnings that
surpassed the Zacks Consensus Estimate by 13.82%. Results were also
higher than the year-ago quarter earnings by 0.9%, driven by strong
underwriting results. Notably, the company delivered positive
earnings surprises in three out of the last four quarters with an
average beat of 12.17%.
This further brightens the outlook for the coming quarters. The
long-term growth rate of this stock is 6.9%.
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