On May 18, Zacks Investment Research upgraded ProAssurance Corporation ( PRA ) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
ProAssurance has been witnessing rising earnings estimates on the back of strong first-quarter 2013 results. Moreover, this property and casualty insurer delivered positive earnings surprises in the last 4 quarters with an average beat of 17.7%. The long-term expected earnings growth rate for this stock is 7.5%.
ProAssurance reported first-quarter results on May 6. Non-GAAP earnings per share came in at 97 cents, striding ahead of the Zacks Consensus Estimate of 76 cents as well as the year-ago quarter's earnings of 78 cents per share.
Top-line growth of nearly 8% as well a 10% decline in total expenses aided the improvement.
Total revenue of ProAssurance increased 8% to $195 million from $180.6 million in the year-ago quarter. Revenues also surpassed the Zacks Consensus Estimate of $175 million.
The combined ratio of ProAssurance improved to 70.5% from 76.6% in the comparable quarter last year,
The Zacks Consensus Estimate for 2013 increased 5% to $3.97 per share as most of the estimates were revised higher over the last 30 days. For 2014, 2 of 4 estimates were revised higher over the same time frame, lifting the Zacks Consensus Estimate by 0.6% to $3.63 per share.
Other Stocks to Consider
Apart from ProAssurance, other property and casualty insurers such as AXIS Capital Holdings Limited ( AXS ), Hilltop Holdings Inc . ( HTH ) and Montpelier Re Holdings Ltd . ( MRH ), among others carry a favorable Zacks Rank # 1 (Strong Buy) and appear impressive.