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Here's Why Everest Re (RE) Stock is an Attractive Bet Now
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Everest Re Group, Ltd. is well-poised for growth, driven by new business opportunities, rate increases, solid renewal retention and higher limited partnership income.
Growth Projections
The Zacks Consensus Estimate for 2021 earnings per share is pegged at $33.29, indicating year-over-year increase of 346.2%.
Estimate Revision
The Zacks Consensus Estimate for 2021 and 2022 has moved 27.1% and 5.5% north, respectively in the past 30 days. This should instill investors' confidence in the stock.
Earnings Surprise History
Everest Re has a decent earnings surprise history. It beat estimates in two of the last four quarters and missed in the other two, with the average being 20.33%.
Zacks Rank & Price Performance
Everest Re currently carries a Zacks Rank #1 (Strong Buy). In the past year, the stock has rallied 20.8%, compared with the industry’s increase of 27.1%.
Image Source: Zacks Investment Research
Style Score
The company has a favorable VGM Score of A. VGM Score helps to identify stocks with the most attractive value, best growth and the most promising momentum. Also, it has an impressive Value Score of A, which reflects an attractive valuation of the stock.
Back-tested results show that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy) offer the best investment opportunities.
Business Tailwinds
Everest Re is witnessing a positive trend in net premiums earned and net investment income driven by solid performance across its Reinsurance and Insurance operations segments.
Increased exposure and new business opportunities with the recovery of U.S. economy, continued double-digit rate increases, expanded shares on attractive renewals, and strong renewal retention are likely to boost the growth of Reinsurance and Insurance operations.
Net investment income surged nearly 11-fold in the second quarter. Higher income from fixed income portfolio, increase in limited partnership income, higher dividend income from equity portfolio, and increased income from other invested assets are likely to drive the metric in the near term.
Loss and expense ratio is likely to improve with continued focus on expense management, renewal rate increases. This in turn will better the combined ratio of the insurer. Underwriting profit surged more than five-fold year over year in the second quarter.
Everest Re’s balance sheet remains very strong that allows for efficient capital deployment as well as ample capacity to continue to execute on market opportunities. Its capital position remained strong with high quality invested assets, significant liquidity and a low operating expense ratio. Banking on strong premium growth, operating cash flow is likely to improve.
This property and casualty insurer’s dividend increased at a seven-year CAGR (2014-2021) of 10.9%. Its dividend yield of 2.3% betters the industry average of 0.4%.
Image: Bigstock
Here's Why Everest Re (RE) Stock is an Attractive Bet Now
Everest Re Group, Ltd. is well-poised for growth, driven by new business opportunities, rate increases, solid renewal retention and higher limited partnership income.
Growth Projections
The Zacks Consensus Estimate for 2021 earnings per share is pegged at $33.29, indicating year-over-year increase of 346.2%.
Estimate Revision
The Zacks Consensus Estimate for 2021 and 2022 has moved 27.1% and 5.5% north, respectively in the past 30 days. This should instill investors' confidence in the stock.
Earnings Surprise History
Everest Re has a decent earnings surprise history. It beat estimates in two of the last four quarters and missed in the other two, with the average being 20.33%.
Zacks Rank & Price Performance
Everest Re currently carries a Zacks Rank #1 (Strong Buy). In the past year, the stock has rallied 20.8%, compared with the industry’s increase of 27.1%.
Image Source: Zacks Investment Research
Style Score
The company has a favorable VGM Score of A. VGM Score helps to identify stocks with the most attractive value, best growth and the most promising momentum. Also, it has an impressive Value Score of A, which reflects an attractive valuation of the stock.
Back-tested results show that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy) offer the best investment opportunities.
Business Tailwinds
Everest Re is witnessing a positive trend in net premiums earned and net investment income driven by solid performance across its Reinsurance and Insurance operations segments.
Increased exposure and new business opportunities with the recovery of U.S. economy, continued double-digit rate increases, expanded shares on attractive renewals, and strong renewal retention are likely to boost the growth of Reinsurance and Insurance operations.
Net investment income surged nearly 11-fold in the second quarter. Higher income from fixed income portfolio, increase in limited partnership income, higher dividend income from equity portfolio, and increased income from other invested assets are likely to drive the metric in the near term.
Loss and expense ratio is likely to improve with continued focus on expense management, renewal rate increases. This in turn will better the combined ratio of the insurer. Underwriting profit surged more than five-fold year over year in the second quarter.
Everest Re’s balance sheet remains very strong that allows for efficient capital deployment as well as ample capacity to continue to execute on market opportunities. Its capital position remained strong with high quality invested assets, significant liquidity and a low operating expense ratio. Banking on strong premium growth, operating cash flow is likely to improve.
This property and casualty insurer’s dividend increased at a seven-year CAGR (2014-2021) of 10.9%. Its dividend yield of 2.3% betters the industry average of 0.4%.
Other Stocks to Consider
Some other top-ranked stocks from the same space include Cincinnati Financial Corporation (CINF - Free Report) , American Financial Group, Inc. (AFG - Free Report) and Fidelity National Financial, Inc. (FNF - Free Report) , each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Cincinnati Financial surpassed estimates in three of the last four quarters and missed in the other one, the average earnings surprise being 36.01%.
The bottom line of American Financial surpassed estimates in each of the last four quarters, the average being 52.82%.
Fidelity National’s earnings surpassed estimates in each of the last four quarters, the average being 37.32%.