We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Here's Why Hold is an Apt Strategy for Alleghany (Y) Stock Now
Read MoreHide Full Article
Alleghany Corporation is well-poised for growth on the back of solid segmental results, strategic buyouts and robust cash position.
The company is well poised for progress as is evident from its favorable VGM Score of B. Here V stands for Value, G for Growth and M for Momentum, with the score being a weighted combination of all three factors.
The company has a decent surprise history. It surpassed the Zacks Consensus Estimate in two of the trailing four quarters, the average beat being 34.08%.
The property and casualty insurer continues to benefit from the solid performance of its Reinsurance as well as Insurance segments, primarily at RSUI Group, Inc. (RSUI). At the Reinsurance segment, improving rates, growth in various traditional casualty and other professional liability lines of business in the United States and U.K., as well as the impact of changes in foreign exchange rates support the premium growth.
Premium growth at RSUI is likely to be driven by higher rates, improved general market conditions and growth in most lines of business due to increases in business opportunities.
Moreover, Alleghany remains focused on net new business growth and acquisitions for expanding existing capabilities, reinforcing global presence and boosting top-line growth. Through its subsidiaries, the company pursues acquisitions, which not only widen its geographical presence but also boost its portfolio.
In the second quarter of 2020, it acquired 55% interest in Wilbert Funeral Services, Inc. whose solid business model aided Alleghany Capital to leverage potential growth opportunities prevailing in noninsurance markets. In the same time frame, it also acquired Kelly Toys Holdings, LLC to grow into a leading toy industry platform with the combination of Jazwares', Alleghany’s subsidiary, unique operating capabilities and Alleghany Capital's financial backing.
Alleghany boasts a solid balance sheet with high liquidity and improving leverage. Its debt to capital of 19.1% betters the industry average of 20.6%. The company exited the third quarter with $1.3 billion in cash balance. Also, it has access to unsecured revolving credit facility $300.0 million, which is scheduled to expire on Jul 31, 2022.
The Zacks Consensus Estimate for 2021 earnings per share is pegged at $45.3, indicating year-over-year increase of nearly 187.62%.
Shares of this Zacks Rank #3 (Hold) property and casualty insurer have rallied 35.7% in the past six months, outperforming the industry's 25.6% growth. Moreover, its solid fundamentals are likely to help the stock retain its momentum.
Arch Capital Group surpassed bottom-line estimates in three of the last four quarters. It has a trailing four-quarter earnings surprise of 31.76%, on average.
Everest Re surpassed bottom-line estimates in three of the last four quarters. It has a trailing four-quarter earnings surprise of 9.54%, on average.
Markel surpassed bottom-line estimates in three of the last four quarters. It has a trailing four-quarter earnings surprise of 143.46%, on average.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Image: Bigstock
Here's Why Hold is an Apt Strategy for Alleghany (Y) Stock Now
Alleghany Corporation is well-poised for growth on the back of solid segmental results, strategic buyouts and robust cash position.
The company is well poised for progress as is evident from its favorable VGM Score of B. Here V stands for Value, G for Growth and M for Momentum, with the score being a weighted combination of all three factors.
The company has a decent surprise history. It surpassed the Zacks Consensus Estimate in two of the trailing four quarters, the average beat being 34.08%.
The property and casualty insurer continues to benefit from the solid performance of its Reinsurance as well as Insurance segments, primarily at RSUI Group, Inc. (RSUI). At the Reinsurance segment, improving rates, growth in various traditional casualty and other professional liability lines of business in the United States and U.K., as well as the impact of changes in foreign exchange rates support the premium growth.
Premium growth at RSUI is likely to be driven by higher rates, improved general market conditions and growth in most lines of business due to increases in business opportunities.
Moreover, Alleghany remains focused on net new business growth and acquisitions for expanding existing capabilities, reinforcing global presence and boosting top-line growth. Through its subsidiaries, the company pursues acquisitions, which not only widen its geographical presence but also boost its portfolio.
In the second quarter of 2020, it acquired 55% interest in Wilbert Funeral Services, Inc. whose solid business model aided Alleghany Capital to leverage potential growth opportunities prevailing in noninsurance markets. In the same time frame, it also acquired Kelly Toys Holdings, LLC to grow into a leading toy industry platform with the combination of Jazwares', Alleghany’s subsidiary, unique operating capabilities and Alleghany Capital's financial backing.
Alleghany boasts a solid balance sheet with high liquidity and improving leverage. Its debt to capital of 19.1% betters the industry average of 20.6%. The company exited the third quarter with $1.3 billion in cash balance. Also, it has access to unsecured revolving credit facility $300.0 million, which is scheduled to expire on Jul 31, 2022.
The Zacks Consensus Estimate for 2021 earnings per share is pegged at $45.3, indicating year-over-year increase of nearly 187.62%.
Shares of this Zacks Rank #3 (Hold) property and casualty insurer have rallied 35.7% in the past six months, outperforming the industry's 25.6% growth. Moreover, its solid fundamentals are likely to help the stock retain its momentum.
Stocks to Consider
Some better-ranked stocks from the same space are Arch Capital Group Ltd. (ACGL - Free Report) , Everest Re Group, Ltd. and Markel Corporation (MKL - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Arch Capital Group surpassed bottom-line estimates in three of the last four quarters. It has a trailing four-quarter earnings surprise of 31.76%, on average.
Everest Re surpassed bottom-line estimates in three of the last four quarters. It has a trailing four-quarter earnings surprise of 9.54%, on average.
Markel surpassed bottom-line estimates in three of the last four quarters. It has a trailing four-quarter earnings surprise of 143.46%, on average.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Click here for the 6 trades >>