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On Mar 20, Zacks Investment Research upgraded Platinum Underwriters Holdings Ltd. (PTP - Snapshot Report) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Platinum Underwriters witnessed rising earnings estimate on the back of strong fourth-quarter 2012 results, which included a positive earnings surprise of 37.31%. Moreover, this property and casualty insurer delivered positive earnings surprises in 3 out of 4 quarters in 2012 with an average beat of 46.27%. The long-term expected earnings growth rate for this stock is 8%.    

Platinum reported its fourth-quarter results on Feb 6. Earnings per share came in at 92 cents surpassing the Zacks Consensus Estimate of 67 cents. Results also improved 73.6% year over year from 53 cents in the year-ago period.

Results largely benefited from strong reserve releases and realized gains as well as moderate catastrophe losses.  

Top line improved 1.4% year over year to $185.5 million, driven by strong improvement in net realized gains on investment (up 2470.3% year over year).

Expenses in the fourth quarter witnessed a sharp decline of 72.1%, attributable to an 18.5% decline in net acquisition expenses.

Combined ratio improved 7680 basis points year over year to 25.4% in the fourth quarter.

During the fourth quarter, Platinum purchased 0.1 million shares for $6.1 million

The Zacks Consensus Estimate for 2013 increased 3.5% to $3.15 per share as 1 of 4 estimates was revised upward over the last 60 days.

Other Stocks to Consider

Other property and casualty insurers like Arch Capital Group Ltd. (ACGL - Snapshot Report), Cincinnati Financial Corporation (CINF - Analyst Report) and Navigators Group Inc. (NAVG - Snapshot Report), carry a Zacks Rank #1 (Strong Buy) and are worth noting.

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