On Feb 16, Zacks Investment Research upgraded
) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
ProAssurance has remained steady based on its strong
third-quarter results, followed by the closure of two
acquisitions - Independent Nevada Doctors Insurance Exchange
(INDIE) and Medmarc Insurance Group - in the past two months.
While the recent stock split makes the stock more attractive to a
diverse group of investors, the special dividend payout in Dec
2012 boosted shareholders' confidence in the stock.
Moreover, this independently traded specialty writer of
medical professional liability insurancedelivered positive
earnings surprises in all of the last 4 quarters with an average
beat of 38.7%. The long-term expected earnings growth rate for
this stock is 7.5%.
On Nov 6, ProAssurance reported third-quarter 2012 operating
earnings per share of $1.71, striding ahead of the Zacks
Consensus Estimate of $1.61 by 6.2%. Growth was driven by a 8.6%
year-over-year accretion in total revenue to $176 million, while
total expenses witnessed a decline of 6.8% to $92.4 million.
Consequently, the Zacks Consensus Estimate for 2012 remained
flat at $4.01 per share as no revisions were made to estimates
over the last 30 days. Following a similar revision trend, the
Zacks Consensus Estimate rose by a penny to $3.67 per share for
This reflects that though intense price and product
competition along with regulatory challenges limit the desired
upside, benefits of geographic diversity, stable ratings,
improving ROE and strong financial position are likely to have a
positive impact on ProAssuarnce over time.
Other Stocks to Consider
Other strong performers in the insurance sector include
XL Group Plc
First American Financial Corp.
), all of which carry a Zacks Rank #1 (Strong Buy).
AEGON N V (AEG): Free Stock Analysis Report
FIRST AMER FINL (FAF): Free Stock Analysis
PROASSURANCE CP (PRA): Free Stock Analysis
XL GROUP PLC (XL): Free Stock Analysis Report
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