XL Group Upgraded to Outperform - Analyst Blog
15 Mars 2013 - 6:39PM
Zacks
On Mar 15, we upgraded XL Group plc (XL) to
Outperform based on its strong fourth-quarter performance and
continued efforts to enhance shareholder value. This property and
casualty insurer presently carries a Zacks Rank #1 (Strong
Buy).
Why the Upgrade?
XL Group’s fourth-quarter 2012 earnings came in at 13 cents, well
above the Zacks Consensus Estimate of a loss of 35 cents per share.
Revenues increased 1.9% from the year-ago period to $89.5 million,
easily surpassing the Zacks Consensus Estimate of $1.7 billion.
Over the past four quarters, XL Group has delivered an average
surprise of 54.2%.
XL Group witnessed upward estimate revisions following its earnings
release. The Zacks Consensus Estimate for 2013 inched up 4.1% to
$2.54 as 4 of 16 estimates were revised higher over the last 30
days.
Why the strong positive bias on the company? With a strong
international exposure and a diversified suite of product offering,
we believe that the company is well positioned to write higher
premiums fueling top-line growth, going forward.
The board of directors approved a $850 million share repurchase
program along with a 27% hike in its quarterly dividend, which will
further boost the bottom line.
The long-term expected earnings growth rate for this stock is
9.4%.
Other Stocks to Consider
Apart from XL Group, other stocks in the property and casualty
sector that are currently performing well include Arch
Capital Group Ltd. (ACGL), Cincinnati Financial
Corp. (CINF) and EMC Insurance Group Inc.
(EMCI). All these companies carry a Zacks Rank #1 (Strong Buy).
ARCH CAP GP LTD (ACGL): Free Stock Analysis Report
CINCINNATI FINL (CINF): Free Stock Analysis Report
EMC INSURANCE (EMCI): Free Stock Analysis Report
XL GROUP PLC (XL): Free Stock Analysis Report
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