On May 15, 2014, Zacks Investment Research upgraded
Hallmark Financial Services Inc.
) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
Hallmark has been witnessing rising earnings estimates on the back
of strong first-quarter 2014 results reported on May 8, surpassing
the Zacks Consensus Estimate by a massive 360%. This drove a
bullish sentiment on the stock, leading to a 100% increase in the
Zacks Consensus Estimate for full-year 2014 to 30 cents per share
over the last 7 days. Moreover, this property and casualty insurer
has delivered positive earnings surprises in the last three
quarters with an average beat of almost 160%.
Apart from beating the Zacks Consensus Estimate, earnings improved
almost 156% year over year. Growth across the profitable and
contracting lines of businesses mainly led to the upside.
Although the top line suffered a decline, it was mitigated by
decreases in loss and loss adjustment expenses as well as other
operating expenses, leading to margin expansion.
Additionally, the first quarter marked the third consecutive
quarter of underwriting profits for Hallmark, mainly attributable
to a solid performance by the Specialty Commercial segment. In
fact, this segment has been delivering outstanding results over the
past three years. The financial position of the company also
remained strong after the first quarter with an increase in book
value, cash and cash equivalents and total assets.
Other Stocks to Consider
Other players in the property and casualty insurance space that
look attractive at current levels include
Endurance Specialty Holdings Inc.
AmTrust Financial Services Inc.
). While AmTrust and Endurance Specialty sport the same Zacks Rank
as Hallmark, Alleghany carries a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
AMTRUST FIN SVC (AFSI): Free Stock Analysis
ENDURANCE SPLTY (ENH): Free Stock Analysis
HALLMARK FINL (HALL): Free Stock Analysis
ALLEGHANY CORP (Y): Free Stock Analysis Report
To read this article on Zacks.com click here.