On Jul 8, 2014, Zacks Investment Research upgraded
AmTrust Financial Services, Inc.
) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
AmTrust has been witnessing rising earnings estimates on the back
of good tidings. Notably, this well-known property and casualty
insurer delivered positive earnings surprises all of the last four
quarters with an average beat of 21.82%. The long-term expected
earnings growth rate for this stock is 15.0%.
Last month, AmTrust Financial entered an agreement to acquire Comp
Options Insurance Company, Inc. (OptaComp) a company affiliated to
the Blue Cross Blue Shield of Florida. With the closure of this
deal (expected by the end of 2014), AmTrust expects to capitalize
on the synergies that include OptaComp's market of low-hazard
workers' compensation insurance risks to gain market share.
Additionally, with a strong financial position to support, we
expect AmTrust Financial to come up with more such endeavors that
would enhance inorganic growth and help generate higher returns in
the long run. Furthermore, AmTrust Financial's robust balance sheet
as well as underwriting and operating performance prompted credit
rating agency A.M. Best to affirm the Financial Strength Rating
(FSR) of "A" to the holding company and Issuer Credit Rating (ICR)
of "a" to the P&C subsidiaries with a stable outlook. The
"bbb" ICR and debt ratings of AmTrust Financial were affirmed as
AmTrust Financial's strong finances also led it to declare a
quarterly cash dividend of 20 cents per share in May 2014, yielding
The Zacks Consensus Estimate for 2014 increased 8.1% to $4.56 per
share as most of the estimates were revised higher over the last 60
days. For 2015, estimates moved upward over the same time frame,
lifting the Zacks Consensus Estimate by 2.1% to $4.95 per share.
Other Stocks to Consider
Other stocks that look attractive at current levels in the property
and casualty space are
Arch Capital Group Ltd.
Endurance Specialty Holdings Ltd.
). All these stocks have the same Zacks Rank as AmTrust.
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
ALLEGHANY CORP (Y): Free Stock Analysis Report
ENDURANCE SPLTY (ENH): Free Stock Analysis
ARCH CAP GP LTD (ACGL): Free Stock Analysis
To read this article on Zacks.com click here.