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Old Republic (ORI) Rises 15% in a Year: More Upside Left?
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Shares of Old Republic International Corporation (ORI - Free Report) have gained 15% in a year against the industry’s decrease of 14.3%. The Finance sector gained 2.9% and the Zacks S&P 500 composite increased 8.7% in the said time frame. With a market capitalization of $7.8 billion, the average volume of shares traded in the last three months was 1.8 million.
Solid market presence, niche focus, low property catastrophe exposure at its General Insurance segment and solid capital position continue to drive ORI.
Old Republic has a decent history of delivering positive surprise in the last three reported quarters and has returned 17.7% per share for the last 10 years to shareholders.
Image Source: Zacks Investment Research
Return on equity in the trailing 12 months was 14.2%, better than the industry average of 9.6%. This highlights this Zacks Rank #2 (Buy) title insurer’s unique combination of specialty property and casualty and Title franchises that offers diversification.
Can ORI Retain the Momentum?
The Zacks Consensus Estimate for ORI’s 2022 earnings has moved north by 3.7% while that for 2023 has moved up 7.5% in the past 60 days, reflecting analysts’ optimism.
The General Insurance segment should continue to benefit from better segmentation, improved risk selection, pricing precision, and increased use of analytics. The segment delivered a combined ratio below 100 in 14 of the last 15 years. Thus, ORI aims combined ratio between 90 and 95 and an expense ratio below 25.
The Title insurance business will likely continue to benefit from expanding presence in the commercial real estate market.
The third-largest title insurer in the country has been strengthening its balance sheet with improving cash balance and low leverage ratio.
Riding on a solid capital position, ORI increased dividend for 40 straight years and paid out dividends for the last 80 years besides paying special dividends occasionally. Its dividend yield of 3.6% betters the industry average of 2%, making it an attractive pick for yield-seeking investors. Old Republic International boasts being one of the 111 companies that have posted at least 25 consecutive years of annual dividend growth.
Horace Mann’s earnings surpassed estimates in each of the last four quarters, the average beat being 22.8%. In the past year, Horace Mann has declined 6.5%.
The Zacks Consensus Estimate for HMN’s 2022 and 2023 earnings has moved 8.3% and 11% north, respectively, in the past 60 days.
Aegon’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 75%. In the past year, Aegon has declined 12.6%.
The Zacks Consensus Estimate for AEG’s 2023 earnings has moved 13.9% north in the past 60 days.
The bottom line of CNO Financial surpassed earnings estimates in each of the last four quarters, the average being 25.48%. In the past year, CNO Financial has declined 11%.
The Zacks Consensus Estimate for CNO’s 2022 and 2023 earnings has moved 0.4% and 0.3% north, respectively, in the past seven days.
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Old Republic (ORI) Rises 15% in a Year: More Upside Left?
Shares of Old Republic International Corporation (ORI - Free Report) have gained 15% in a year against the industry’s decrease of 14.3%. The Finance sector gained 2.9% and the Zacks S&P 500 composite increased 8.7% in the said time frame. With a market capitalization of $7.8 billion, the average volume of shares traded in the last three months was 1.8 million.
Solid market presence, niche focus, low property catastrophe exposure at its General Insurance segment and solid capital position continue to drive ORI.
Old Republic has a decent history of delivering positive surprise in the last three reported quarters and has returned 17.7% per share for the last 10 years to shareholders.
Image Source: Zacks Investment Research
Return on equity in the trailing 12 months was 14.2%, better than the industry average of 9.6%. This highlights this Zacks Rank #2 (Buy) title insurer’s unique combination of specialty property and casualty and Title franchises that offers diversification.
Can ORI Retain the Momentum?
The Zacks Consensus Estimate for ORI’s 2022 earnings has moved north by 3.7% while that for 2023 has moved up 7.5% in the past 60 days, reflecting analysts’ optimism.
The General Insurance segment should continue to benefit from better segmentation, improved risk selection, pricing precision, and increased use of analytics. The segment delivered a combined ratio below 100 in 14 of the last 15 years. Thus, ORI aims combined ratio between 90 and 95 and an expense ratio below 25.
The Title insurance business will likely continue to benefit from expanding presence in the commercial real estate market.
The third-largest title insurer in the country has been strengthening its balance sheet with improving cash balance and low leverage ratio.
ORI has a VGM Score of B
Solid Dividend History
Riding on a solid capital position, ORI increased dividend for 40 straight years and paid out dividends for the last 80 years besides paying special dividends occasionally. Its dividend yield of 3.6% betters the industry average of 2%, making it an attractive pick for yield-seeking investors. Old Republic International boasts being one of the 111 companies that have posted at least 25 consecutive years of annual dividend growth.
Other Stocks to Consider
Some other top-ranked insurers include Horace Mann Educators Corporation (HMN - Free Report) , Aegon (AEG - Free Report) and CNO Financial Group (CNO - Free Report) . While Horace Mann sports a Zacks Rank #1 (Strong Buy), Aegon and CNO Financial each carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Horace Mann’s earnings surpassed estimates in each of the last four quarters, the average beat being 22.8%. In the past year, Horace Mann has declined 6.5%.
The Zacks Consensus Estimate for HMN’s 2022 and 2023 earnings has moved 8.3% and 11% north, respectively, in the past 60 days.
Aegon’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 75%. In the past year, Aegon has declined 12.6%.
The Zacks Consensus Estimate for AEG’s 2023 earnings has moved 13.9% north in the past 60 days.
The bottom line of CNO Financial surpassed earnings estimates in each of the last four quarters, the average being 25.48%. In the past year, CNO Financial has declined 11%.
The Zacks Consensus Estimate for CNO’s 2022 and 2023 earnings has moved 0.4% and 0.3% north, respectively, in the past seven days.