Mar 20, 2014
, we issued an updated research report on
W.R. Berkley Corporation
W.R. Berkley Corp. reported fourth-quarter 2013 core operating
earnings of 85 cents per share, 8 cents ahead of the Zacks
Consensus Estimate. Earnings were also up 33% year over year.
The earnings beat came on the back of higher premiums written,
pricing increases outpacing loss cost trends and a lower share
W.R. Berkley Corp. has maintained a trend of premium growth
for the past several quarters mainly owing to its start-up units.
In 2006 (when the soft market cycle started), the company
commenced several new units to take advantage of the eventual
With new units continuing to grow and established businesses
no longer losing volume (retention rate was 80% for eight
successive quarters), overall growth is visible. This consistent
expansion positions the company well to benefit from the
improving market conditions.
In addition to the start-up units, W.R. Berkley Corp.'s
International business segment is also showing impressive growth,
outperforming other segments.
The company is also experiencing rate increases for the past
few quarters, which should drive top-line growth going
W.R. Berkley Corp. maintains a solid balance sheet with
sufficient liquidity and strong cash flow. Its
shareholder-friendly capital management strategy has enabled the
company to announce dividend increases and raise share buybacks
from time to time.
However, exposure to catastrophe and low interest rates remain
as near-term headwinds for the company.
W.R. Berkley Corp. currently retains a Zacks Rank #3 (Hold).
AmTrust Financial Services, Inc.
Atlas Financial Holdings, Inc.
), all with a Zacks Rank #1 (Strong Buy), are worth considering.
ATLAS FINL HLDG (AFH): Free Stock Analysis
AMTRUST FIN SVC (AFSI): Free Stock Analysis
BERKLEY (WR) CP (WRB): Free Stock Analysis
ALLEGHANY CORP (Y): Free Stock Analysis
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