Back to top

Analyst Blog

On Jul 3, Zacks Investment Research upgraded W.R. Berkley Corporation (WRB - Analyst Report) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

W.R. Berkley delivered positive earnings surprises in 3 out of the last 4 quarters with an average beat of 15.3%. The long-term earnings growth of the company is presently pegged at 9.5%.

We expect the property and casualty insurer to surpass expectations when it reports its second-quarter results on Jul 22.  Our proven model shows that the property and casualty insurer is likely to beat earnings because it has a right combination of a positive Earnings ESP (Read: Zacks Earnings ESP: A Better Method) and  Zacks Rank #1. ESP or Expected Surprise Prediction, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is at +1.47%.

Additionally, for the second quarter, the Zacks Consensus Estimate is pegged at 68 cents, up 4.4% year over year. The Zacks Consensus Estimate for 2013 increased 0.3% to $2.89 per share over the last 60 days, reflecting a year-over-year increase of 10.6%. The same for 2014 is pegged at $3.18, translating to a 10.3% year-over-year improvement.

W.R. Berkley is witnessing stable retention even with a general rate hike for the past many quarters. It is also successful in maintaining the trend of premium growth. The company’s investments in a number of start-ups over the last four years have enabled it to capitalize on the improved market scenario. Its International business is another area, which will fuel long-term earnings growth.

Moreover, W.R. Berkley’s strong operational performances support its commitment to return value to its shareholders. In May, the board approved an 11% dividend hike, representing a new annualized rate of 40 cents per share and a yield of 0.96%.

Other Stocks to Consider

Apart from W.R. Berkley, Alleghany Corporation (Y - Snapshot Report), HCI Group, Inc. (HCI - Snapshot Report), and Hilltop Holdings Inc. (HTH - Analyst Report) are also worth considering. All these carry a Zacks Rank #1 (Strong Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
GTT COMMUNI… GTT 11.65 +4.11%
ALLERGAN IN… AGN 161.82 +3.99%
CLAYTON WIL… CWEI 117.06 +3.73%
GREENBRIER… GBX 69.63 +2.37%
RF MICRO DE… RFMD 12.02 +2.04%