Zacks Investment Research downgraded
Selective Insurance Group, Inc.
) to a Zacks Rank #4 (Sell) on Dec 24, 2013.
Why the Downgrade?
Selective Insurance witnessed downward estimate revisions after
reporting mixed third-quarter 2013 results. Additionally,
Selective Insurance delivered negative earnings surprise in two
out of the last three quarters. Over the last 30 days, estimates
moved downwards leading to an approximately 2% decline in the
Zacks Consensus Estimate for full year 2013 to $1.61 per
On Oct 30, Selective Insurance reported third-quarter earnings
per share of 42 cents, which although higher than the year-ago
earnings, missed the Zacks Consensus Estimate by 4.6%.
The quarter experienced an increase in total expenses due to
higher loss and loss expense and policy acquisition costs.
Catastrophe losses and interest expense also increased during the
quarter. Further, over the last nine months of 2013, the debt
burden of Selective Insurance increased approximately 28% from
year end 2012 leading to deterioration in the debt-to-capital
Additionally, the company expects the weighted average share
outstanding to be around 57 million for full year 2013, higher
than the earlier guidance of 56 million. Higher share count might
affect earnings per share adversely in the upcoming period.
Other Stocks to Consider
ARCH CAP GP LTD (ACGL): Free Stock Analysis
AMTRUST FIN SVC (AFSI): Free Stock Analysis
ALLIED WORLD AS (AWH): Free Stock Analysis
SELECT INS GRP (SIGI): Free Stock Analysis
To read this article on Zacks.com click here.
However, some better-ranked stocks in the property and casualty
insurance space include
Allied World Assurance Company Holdings, AG
AmTrust Financial Services, Inc.
Arch Capital Group Ltd.
). While Allied World and AmTrust Financial carry a Zacks Rank #1
(Strong Buy), Arch Capital carries a Zacks Rank #2 (Buy).