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Here's Why You Should Hold Hartford Financial (HIG) Stock
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The Hartford Financial Services Group, Inc. (HIG - Free Report) remains in investors' good books on the back of strategic measures and a growing cash balance. These factors raise optimism for HIG’s long-term prospects as well.
Its return-on-equity (ROE) reflects growth potential. Hartford Financial’s trailing 12-month ROE of 12.4% compares favorably with the industry average of 9.6%, thereby reflecting its efficiency in using its shareholders’ funds.
HIG also continues to gain leverage from small commercial new business and Middle market new businesses.
The insurer has a market capital of $23.75 billion. HIG has an impressive VGM Score of A. Here V stands for Value, G for Growth and M for Momentum with the score being a weighted combination of all three factors.
The multiline insurance player came up with a trailing four-quarter surprise of 34.6%, on average. Its earnings beat estimates on three occasions and missed the mark once.
HIG runs its business through The Commercial Lines and The Personal Lines segments, each contributing 50.7% and 14.5% to its revenues, respectively.
Let’s analyze the factors that make this stock a compelling choice for investors right now.
Hartford Financial’s buyouts and divestitures have helped it grow over the past few years. HIG is vending non-core businesses to concentrate on its U.S. operations and enhance its operating leverage.
HIG recently sold its Navigators Holdings (Europe) NV and subsidiaries to Premia Holdings, Bermuda domiciled legacy reinsurer. The deal was closed on Dec 29, 2021, after being approved by the National Bank of Belgium and the Commissariat Aux Assurances in Luxemburg.
Apart from lowering expenses, boosting profitability and improving its shareholders’ returns, Hartford Financial is enhancing its financial flexibility by freeing up more capital through divestitures.
Moreover, HIG has been driving its portfolio and enhancing its capabilities through acquisitions. In 2019, Hartford Financial closed the buyout of Navigators Group, a specialty insurer for a deal value of $2.1 billion. The move helped HIG expand its product offerings and geographic reach plus strengthen its commercial business lines.
This multiline insurer has been taking restructuring measures for a while to curb expenses. Hartford Financial took measures to cut down on costs by $540 million within 2022 and $625 million in 2023. Management said that HIG achieved $423 million of expense savings through 2021.
Hartford Financial’s solvency position should instill investor’s confidence in the stock. Total debt is 27.7% (almost unchanged from the sequential figure) of its total equity, lower than the industry average of 38.3%. HIG exited 2021 with cash and investments of $1.9 billion.
On the back of its balance sheet strength, Hartford Financial continues its capital management strategy through dividend hikes and share buybacks. Management announced that HIG increased its share repurchase authorization by $500 million, thus bringing the plan through 2022 to $3 billion. As of Dec 31, 2021, HIG had $1.3 billion of share repurchase authorization remaining.
Shares of Hartford Financial have gained 3.5% in a year against the industry’s decline of 8.6%. HIG currently carries a Zacks Rank #3 (Hold).
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks in the insurance space are Horace Mann Educators Corporation (HMN - Free Report) , Old Republic International Corporation (ORI - Free Report) and CNO Financial Group, Inc. (CNO - Free Report) . While Horace Mann sports a Zacks Rank #1 (Strong Buy), Old Republic International and CNO Financial carry a Zacks Rank #2 (Buy) at present. 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 being 22.80%. The Zacks Consensus Estimate for HMN’s 2022 earnings suggests an improvement of 1.1%, while the same for revenues suggests growth of 1% from the respective year-ago reported figures.
The bottom line of Old Republic International outpaced earnings estimates in all the last four quarters, the average being 38.74%. The Zacks Consensus Estimate for ORI’s 2022 revenues suggests an improvement of 0.80% from the year-ago reported figure. The consensus estimate for 2022 earnings has been revised 3.7% upward in the past 60 days. ORI has a VGM Score of B.
CNO Financial’s earnings surpassed estimates in each of the trailing four quarters, the average being 25.48%. The Zacks Consensus Estimate for CNO’s 2022 earnings has moved 0.8% north in the past 30 days. CNO boasts a VGM Score of B.
Shares of HMN have lost 5% in a year's time, while the stocks of CNO and ORI have gained 1.9% and 17.6%.
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Here's Why You Should Hold Hartford Financial (HIG) Stock
The Hartford Financial Services Group, Inc. (HIG - Free Report) remains in investors' good books on the back of strategic measures and a growing cash balance. These factors raise optimism for HIG’s long-term prospects as well.
Its return-on-equity (ROE) reflects growth potential. Hartford Financial’s trailing 12-month ROE of 12.4% compares favorably with the industry average of 9.6%, thereby reflecting its efficiency in using its shareholders’ funds.
HIG also continues to gain leverage from small commercial new business and Middle market new businesses.
The insurer has a market capital of $23.75 billion. HIG has an impressive VGM Score of A. Here V stands for Value, G for Growth and M for Momentum with the score being a weighted combination of all three factors.
The multiline insurance player came up with a trailing four-quarter surprise of 34.6%, on average. Its earnings beat estimates on three occasions and missed the mark once.
HIG runs its business through The Commercial Lines and The Personal Lines segments, each contributing 50.7% and 14.5% to its revenues, respectively.
Let’s analyze the factors that make this stock a compelling choice for investors right now.
Hartford Financial’s buyouts and divestitures have helped it grow over the past few years. HIG is vending non-core businesses to concentrate on its U.S. operations and enhance its operating leverage.
HIG recently sold its Navigators Holdings (Europe) NV and subsidiaries to Premia Holdings, Bermuda domiciled legacy reinsurer. The deal was closed on Dec 29, 2021, after being approved by the National Bank of Belgium and the Commissariat Aux Assurances in Luxemburg.
Apart from lowering expenses, boosting profitability and improving its shareholders’ returns, Hartford Financial is enhancing its financial flexibility by freeing up more capital through divestitures.
Moreover, HIG has been driving its portfolio and enhancing its capabilities through acquisitions. In 2019, Hartford Financial closed the buyout of Navigators Group, a specialty insurer for a deal value of $2.1 billion. The move helped HIG expand its product offerings and geographic reach plus strengthen its commercial business lines.
This multiline insurer has been taking restructuring measures for a while to curb expenses. Hartford Financial took measures to cut down on costs by $540 million within 2022 and $625 million in 2023. Management said that HIG achieved $423 million of expense savings through 2021.
Hartford Financial’s solvency position should instill investor’s confidence in the stock. Total debt is 27.7% (almost unchanged from the sequential figure) of its total equity, lower than the industry average of 38.3%. HIG exited 2021 with cash and investments of $1.9 billion.
On the back of its balance sheet strength, Hartford Financial continues its capital management strategy through dividend hikes and share buybacks. Management announced that HIG increased its share repurchase authorization by $500 million, thus bringing the plan through 2022 to $3 billion. As of Dec 31, 2021, HIG had $1.3 billion of share repurchase authorization remaining.
Shares of Hartford Financial have gained 3.5% in a year against the industry’s decline of 8.6%. HIG currently carries a Zacks Rank #3 (Hold).
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks in the insurance space are Horace Mann Educators Corporation (HMN - Free Report) , Old Republic International Corporation (ORI - Free Report) and CNO Financial Group, Inc. (CNO - Free Report) . While Horace Mann sports a Zacks Rank #1 (Strong Buy), Old Republic International and CNO Financial carry a Zacks Rank #2 (Buy) at present. 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 being 22.80%. The Zacks Consensus Estimate for HMN’s 2022 earnings suggests an improvement of 1.1%, while the same for revenues suggests growth of 1% from the respective year-ago reported figures.
The bottom line of Old Republic International outpaced earnings estimates in all the last four quarters, the average being 38.74%. The Zacks Consensus Estimate for ORI’s 2022 revenues suggests an improvement of 0.80% from the year-ago reported figure. The consensus estimate for 2022 earnings has been revised 3.7% upward in the past 60 days. ORI has a VGM Score of B.
CNO Financial’s earnings surpassed estimates in each of the trailing four quarters, the average being 25.48%. The Zacks Consensus Estimate for CNO’s 2022 earnings has moved 0.8% north in the past 30 days. CNO boasts a VGM Score of B.
Shares of HMN have lost 5% in a year's time, while the stocks of CNO and ORI have gained 1.9% and 17.6%.