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Aspira Women's Health Inc. (AWH) - $25 value - yours FREE >>
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Is Argo Group (AGII) Stock Worth Adding to Your Portfolio?
On Aug 9, Zacks Investment Research upgraded Argo Group International Holdings, Ltd to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
Argo Group has been witnessing rising earnings estimates on the back of strong second-quarter 2016 results. This property and casualty insurer reported earnings of $1.05, resulting in a positive earnings surprise of 61.54%, in the second quarter. Earnings improved 26.5% year over year on solid results in the alternative investment portfolio. Long-term earnings growth is pegged at 7.0%
Revenues improved 4.9% year over year to $386 million in the second quarter besides outperforming the Zacks Consensus Estimate by 2.8%. The improvement was largely driven by a 46% year-over-year increase in net investment income. Return on investment was 1.8%.
Riding on solid operational performance, the company has strengthened its balance sheet. While total cash and investments of $4.3 billion improved 2.4% over the 2015 end level, debts were almost the same. The debt-to-equity ratio also improved 40 basis points over the 2015-end level. Book value per share improved 6.7% over 2015 end.
Argo Group stated that it continues to benefit from its prudent loss reserving strategy. The company has been witnessing favorable loss reserve development for the last 21 straight quarters and in each of the last 11 years.
Banking on balance sheet strength, Argo Group could effectively deploy its capital in shareholder-friendly moves. The insurer spent $21 million to buy back 0.3 million shares in the quarter.
The Zacks Consensus Estimate for 2016 moved up 8.4% to $3.89 as 50% of the estimates were revised higher over the last 30 days. For 2017, 50% estimates were revised higher over the same time frame, pushing up the Zacks Consensus Estimate by 3.1% to $4.03.
ARGO GROUP INTL Price and Consensus
ARGO GROUP INTL Price and Consensus | ARGO GROUP INTL Quote
Other Stocks to Consider
Apart from Argo Group, Allied World Assurance Company Holdings, AG (AWH - Free Report) , National Interstate Corporation (NATL - Free Report) and NMI Holdings, Inc. (NMIH - Free Report) sport a Zacks Rank #1.
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