Shares of Chubb Limited (CB - Free Report) have outperformed the Zacks categorized Property and Casualty Insurance industry, quarter to date. While the company shares appreciated 5.08%, the industry lost 0.30%. Notably, the stock has also outperformed the S&P 500 over same time frame. The estimates have also been revised upward for last 30 days. Its return on equity is 10.1%, which is much higher than the industry’s 6.5%.
Chubb has always considered acquisition an effective strategy for inorganic growth and global expansion. Its merger with ACE Limited bears a testimony for the same. Chubb is now better poised with competitive edge, increased scale and efficiencies and a sizeable balance sheet. The company is on track to achieve annual run-rate integration-related savings of $800 million by the 2018-end.
Apart from focusing on inorganic growth, Chubb made investments in various strategic initiatives like cyber insurance capitalizing on the potential of middle-market businesses, doing away with businesses that do not meet its risk appetite and generating lower net premium to pave the way for long-term growth.
Chubb is however scaling down its guidance for net premiums written in a few portfolios for 2017. This is because the company anticipates to lower its catastrophe-related exposure and not to generate enough underwriting returns.
Net investment income, a component of an insurer’s topline, has started to show signs of improvement. Following the Federal Reserve’s announcement of an interest rate hike of 0.25% in Dec 2016 and another 1% in Mar 2016 (reflecting Fed’s confidence in the improving U.S. economy), the Zacks Rank #3 (Hold) insurer expects its quarterly investment income run rate to remain in the range of $830–$840 million.
The company also effectively deploys capital to enhance shareholders’ value via dividend increases and share buybacks, owing to a sturdy capital position. Chubb’s 3% dividend hike in May 2017 should enable it to maintain the targeted dividend payout ratio of about 30%. It is also left with $769 million under its share repurchase authorization.
Per estimate revisions, the Zacks Consensus Estimate moved up by a cent to $10.36 for 2017 and by a couple of cents to $10.69 for 2018 for the last 30 days. Chubb’s expected long-term earnings growth rate is currently pegged at 10%. Also, its price earnings growth ratio of 1.37 favorably compares with an industry average 1.66.
Stocks to Consider
Better-ranked property and casualty insurers are First American Financial Corporation (FAF - Free Report) , State National Companies, Inc. and ProAssurance Corporation (PRA - Free Report) .
State National Companies provides property and casualty insurance in the United States. The company delivered positive surprises in two of the last four quarters with average beat of 20.54%. The company flaunts Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
First American Financial provides financial services. The company delivered positive surprises in the last four quarters with an average beat of 14.12%. The company sports Zacks Rank #1
ProAssurance operates as a holding company for many property and casualty insurance companies. The company delivered positive surprises in last four quarters with an average beat of 16.59%. The company carries Zacks Rank #2.
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Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Shares of Chubb Limited (CB - Free Report) have outperformed the Zacks categorized Property and Casualty Insurance industry, quarter to date. While the company shares appreciated 5.08%, the industry lost 0.30%. Notably, the stock has also outperformed the S&P 500 over same time frame. The estimates have also been revised upward for last 30 days. Its return on equity is 10.1%, which is much higher than the industry’s 6.5%.
Chubb has always considered acquisition an effective strategy for inorganic growth and global expansion. Its merger with ACE Limited bears a testimony for the same. Chubb is now better poised with competitive edge, increased scale and efficiencies and a sizeable balance sheet. The company is on track to achieve annual run-rate integration-related savings of $800 million by the 2018-end.
Apart from focusing on inorganic growth, Chubb made investments in various strategic initiatives like cyber insurance capitalizing on the potential of middle-market businesses, doing away with businesses that do not meet its risk appetite and generating lower net premium to pave the way for long-term growth.
Chubb is however scaling down its guidance for net premiums written in a few portfolios for 2017. This is because the company anticipates to lower its catastrophe-related exposure and not to generate enough underwriting returns.
Net investment income, a component of an insurer’s topline, has started to show signs of improvement. Following the Federal Reserve’s announcement of an interest rate hike of 0.25% in Dec 2016 and another 1% in Mar 2016 (reflecting Fed’s confidence in the improving U.S. economy), the Zacks Rank #3 (Hold) insurer expects its quarterly investment income run rate to remain in the range of $830–$840 million.
The company also effectively deploys capital to enhance shareholders’ value via dividend increases and share buybacks, owing to a sturdy capital position. Chubb’s 3% dividend hike in May 2017 should enable it to maintain the targeted dividend payout ratio of about 30%. It is also left with $769 million under its share repurchase authorization.
Per estimate revisions, the Zacks Consensus Estimate moved up by a cent to $10.36 for 2017 and by a couple of cents to $10.69 for 2018 for the last 30 days. Chubb’s expected long-term earnings growth rate is currently pegged at 10%. Also, its price earnings growth ratio of 1.37 favorably compares with an industry average 1.66.
Stocks to Consider
Better-ranked property and casualty insurers are First American Financial Corporation (FAF - Free Report) , State National Companies, Inc. and ProAssurance Corporation (PRA - Free Report) .
State National Companies provides property and casualty insurance in the United States. The company delivered positive surprises in two of the last four quarters with average beat of 20.54%. The company flaunts Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
First American Financial provides financial services. The company delivered positive surprises in the last four quarters with an average beat of 14.12%. The company sports Zacks Rank #1
ProAssurance operates as a holding company for many property and casualty insurance companies. The company delivered positive surprises in last four quarters with an average beat of 16.59%. The company carries Zacks Rank #2.
Will You Make a Fortune on the Shift to Electric Cars?Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge. With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research. It's not the one you think. See This Ticker Free >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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