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Atlas Financial Shares Gain on Solid Q4 Earnings - Analyst Blog

By: Zacks.com
Posted: 3/13/2014 10:25:00 AM
Referenced Stocks: AFG;AFH;AFSI;Y

Shares of Atlas Financial Holdings, Inc. ( AFH ) continue to rally riding on the strength of fourth-quarter earnings results. Shares surged almost 12.3% since the earnings announcement on Mar 10.

The Zacks Consensus Estimate for 2014 moved north by 4.2% to $1.00 while that for 2015 rose 8.9% to $1.35 over the last seven days.

Atlas Financial's fourth-quarter net operating earnings per share of 22 cents, increased 46.7% year over year. The number also beat the Zacks Consensus Estimate by a penny.

Bottom-line growth was largely driven by the company's revenue accretion. Significant improvement in net premiums earned drove the top line, which surged 72.2% year over year. Total revenue also exceeded the Zacks Consensus Estimate by 20.7%.

Atlas Financial's gross premium written surged substantially during the reported quarter, which resulted from higher premiums written in the commercial auto business line.

Underwriting results of Atlas Financial also exhibited improvement during the fourth quarter increasing 28.6% year over year.

Atlas Financial is witnessing operating synergies owing to its well-managed vertical expansion throughout its geographic base, established over the past two years. The company's acquisition of Gateway, in early 2013, has also contributed to top-line growth.

We expect the company's 2014 earnings to gain from insurance price strengthening and augmenting business operations. It is also worth noting that Atlas Financial is not materially exposed to catastrophic risk which eliminates potential earnings volatility.

Atlas Financial is also equipped with strong assets. Total assets of the company as of 2013-end stood at $219.3 million compared to $163 million as of 2012-end.

Zacks Rank

Atlas Financial presently carries a Zacks Rank #1 (Strong Buy). Investors interested in the property and casualty insurance industry may also consider some other top-ranked stocks like Alleghany Corporation ( Y ), American Financial Group Inc. ( AFG ) and AmTrust Financial Services, Inc. ( AFSI ). All these stocks sport the same Zacks Rank as Atlas Financial.



AMER FINL GROUP (AFG): Free Stock Analysis Report

ATLAS FINL HLDG (AFH): Free Stock Analysis Report

AMTRUST FIN SVC (AFSI): Free Stock Analysis Report

ALLEGHANY CORP (Y): Free Stock Analysis Report

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