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W. R. Berkley Remains Well Poised for Long Term Growth

We issued an updated research report on W. R. Berkley CorporationWRB on Aug 26, 2015.

W.R. Berkley Corp. has witnessed premium growth over the past several quarters mainly due to the start-up units established in 2006. With new units continuing to grow and established businesses no longer losing volume, overall growth is evident. Recently, the company established a new unit - Berkley International Seguros Colombia S.A. - to better serve the Colombian reinsurance market that it forayed into in 2014. Consistent expansion places the company well to benefit from improving market conditions. In addition, the international segment is witnessing growing premiums.

W.R. Berkley maintains a solid balance sheet with sufficient liquidity and strong cash flows. This helps it to engage in shareholder friendly moves. While the latest dividend hike, approved in Jun 2015, marked the eleventh consecutive increase, the board also increased its share repurchase authorization from its previous level of 10 million shares.

However, competitive global reinsurance market conditions will continue to put pressure on the rate of return over the near term, while the sustained soft interest rate environment will weigh on investment results.

Earnings Review

Last month, the company reported second-quarter 2015 earnings that missed the Zacks Consensus Estimate and also declined year over year by a penny due to a decrease in investment income. With respect to earnings trend, the company delivered positive surprise in two of the last four quarters with an average beat of 1.35%. The expected long-term earnings growth is currently pegged at 9%.

Zacks Rank

W.R. Berkley presently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the property and casualty insurance space are First American Financial Corporation FAF , Hallmark Financial Services, Inc. HALL and NMI Holdings, Inc. NMIH . All three stocks sport a Zacks Rank #1 (Strong Buy).

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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

BERKLEY (WR) CP (WRB): Free Stock Analysis Report

FIRST AMER FINL (FAF): Free Stock Analysis Report

HALLMARK FINL (HALL): Free Stock Analysis Report

NMI HOLDINGS-A (NMIH): Free Stock Analysis Report

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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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