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Is Allied World (AWH) Worth Adding to Your Portfolio? - Analyst Blog

On Oct 21, 2014, Zacks Investment Research upgraded Allied World Assurance Company Holdings, AG ( AWH ) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Allied World has been witnessing rising earnings estimates on the back of a number of positive tidings at the company, which include investment in the real estate market, product launches as well as mergers and acquisitions. The Zacks Consensus Estimate for 2014 increased 1.8% to $3.36 per share as an estimate was revised upward over the last 60 days.

Earlier this month, Allied World entered into an investment agreement with Blue Vista Capital Management LLC (Blue Vista), a real estate private equity firm. As per the deal, Allied World acquired a minority stake in the company and decided to provide growth capital for Blue Vista's real estate investment capital platform expansion.

This deal ushered Allied World into investing in the real estate sector and real estate asset management. This transaction is expected to prove beneficial for the company as it complements the existing asset management relationships of Allied World.

Moreover, in Aug 2014, the company inked a deal to acquire the Hong Kong and Singapore operations of Royal & Sun Alliance Insurance plc. for $215 million. This is in line with the company's strategy of increasing its scale of specialty insurance operations in the region.

Further, over the last two months, Allied World has launched two products that aid the company's portfolio expansion objectives. First, the company introduced its property line for energy risks catering to the Canadian market. However, the initial phase of the launch of the property and casualty coverages took place in May and this was the next step toward establishing a best-in-class P&C insurance in the Canadian market.

Moreover, Allied World of North America added a product to ForceField, which is a range of the company's professional liability products. The beneficiaries of the deal include the U.S.-based publicly traded companies, which will be insured from an extensive range of liability exposures. This launch definitely enhances the liability insurance portfolio, thereby making the company more competent to serve clients.

All the aforementioned developments drove bullish sentiment on the stock and pulled up share prices by 3.9% over the last two months to close at $37.77 in the last trading session.

Other Stocks to Consider

Investors interested in the property and casualty insurance industry could also consider stocks like Alleghany Corp. ( Y ), Endurance Specialty Holdings Ltd. ( ENH ) and HCI Group, Inc. ( HCI ). All three carry the same Zacks Rank as Allied World.

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ALLIED WORLD AS (AWH): Free Stock Analysis Report

ALLEGHANY CORP (Y): Free Stock Analysis Report

ENDURANCE SPLTY (ENH): Free Stock Analysis Report

HCI GROUP INC (HCI): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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