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 You Should Add Chubb (CB) Stock to Your Portfolio
Read MoreHide Full Article
Chubb Limited’s (CB - Free Report) compelling portfolio, strong renewal retention, positive rate increases, strategic initiatives to fuel profitability and solid capital position make it a stock worth adding to one’s portfolio.
Being one of the world’s largest providers of property and casualty (P&C) insurance and reinsurance and the largest publicly traded P&C insurer based on market capitalization, Chubb has a decent history of delivering positive surprises in the last six reported quarters.
This insurer has an impressive VGM Score of A. This helps to identify stocks with the most attractive value, growth and momentum.
The trailing 12 months ROE is 10.3%, better than the industry average of 5.7%, reflecting efficiency in utilizing shareholders’ funds.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2022 and 2023 earnings has moved 0.3% and 0.2% north, respectively, in the past 30 days, reflecting analyst optimism.
Zacks Rank & Price Performance
CB currently carries a Zacks Rank #2 (Buy). Year to date, the stock has gained 2.4% against the industry’s decline of 4.7%, the Finance sector’s decline of 18.5% and the Zacks S&P 500 composite’s decrease of 21.8%.
Image Source: Zacks Investment Research
Optimistic Growth Projections
The Zacks Consensus Estimate for 2022 earnings stands at $14.96, implying an increase of 19.1% from the year-ago reported figure on 3.9% higher revenues of $43.6 billion. The consensus estimate for 2023 earnings stands at $16.58, implying an increase of 10.8% from the year-ago reported figure on 8.8% higher revenues of $47.4 billion.
The expected long-term earnings growth is pegged at 10%.
The stock carries an impressive Value Score of A. Value Score helps find stocks that are undervalued. Back-tested results have shown that stocks with a favorable Value Score, when combined with a solid Zacks Rank, are the best investment bets.
Growth Drivers
Solid commercial businesses, commercial P&C rate increases, improving underwriting margins, new business and strong renewal retention should continue to drive premiums. Chubb’s focus on capitalizing on the potential of middle-market businesses, both domestic and international, with the traditional core package as well as specialty products bodes well for growth.
Chubb expects continued growth and margin improvement in 2022, as it capitalizes on favorable underwriting conditions for commercial P&C businesses globally.
The pending acquisition of the life and non-life insurance companies of Cigna Corporation in seven Asia-Pacific markets testifies Chubb’s efforts to expand its presence in the Asia-Pacific region. The addition of Cigna’s business will boost Chubb’s A&H business as well as expand its Asia-based life insurance presence. Upon closing, Chubb’s Asia-Pacific portfolio will increase to $7 billion in premiums from $4 billion at present. Chubb expects to realize in excess of $80 million of expense savings with one-time integration costs of about $100 million.
With an improving rate environment, a solid investment portfolio and positive operating cash flow, investment income should rise. Chubb estimates the quarterly run rate to be in the range of $915-925 million in 2022 and increase thereafter.
Chubb has a strong capital position with sufficient cash generation capabilities and has $1.6 billion remaining under its share buyback authorization.
Impressive Dividend History
Chubb has increased dividends for the last 29 years. The dividend yield is 1.6%, better than the industry average of 0.3%. The insurer will propose a dividend hike of 3.7%.
W.R. Berkley’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 27.08%. Year to date, W.R. Berkley stock has increased 21.5%.
The Zacks Consensus Estimate for WRB’s 2022 and 2023 earnings has moved 7% and 5.1% north, respectively, in the past 60 days.
American Financial delivered a four-quarter average earnings surprise of 41.72%. Year to date, shares of American Financial has dropped 3.8%.
The Zacks Consensus Estimate for AFG’s 2022 and 2023 earnings has moved 9.8% and 6.9% north, respectively, in the past 60 days.
United Fire Group delivered a four-quarter average earnings surprise of 270.83%. Year to date, the insurer has rallied 36.8%.
The Zacks Consensus Estimate for UFGS’ 2022 earnings has moved 23.5% north in the past 30 days and implies a 46.2% increase from the year-ago reported figure.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Here's Why You Should Add Chubb (CB) Stock to Your Portfolio
Chubb Limited’s (CB - Free Report) compelling portfolio, strong renewal retention, positive rate increases, strategic initiatives to fuel profitability and solid capital position make it a stock worth adding to one’s portfolio.
Being one of the world’s largest providers of property and casualty (P&C) insurance and reinsurance and the largest publicly traded P&C insurer based on market capitalization, Chubb has a decent history of delivering positive surprises in the last six reported quarters.
This insurer has an impressive VGM Score of A. This helps to identify stocks with the most attractive value, growth and momentum.
The trailing 12 months ROE is 10.3%, better than the industry average of 5.7%, reflecting efficiency in utilizing shareholders’ funds.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2022 and 2023 earnings has moved 0.3% and 0.2% north, respectively, in the past 30 days, reflecting analyst optimism.
Zacks Rank & Price Performance
CB currently carries a Zacks Rank #2 (Buy). Year to date, the stock has gained 2.4% against the industry’s decline of 4.7%, the Finance sector’s decline of 18.5% and the Zacks S&P 500 composite’s decrease of 21.8%.
Image Source: Zacks Investment Research
Optimistic Growth Projections
The Zacks Consensus Estimate for 2022 earnings stands at $14.96, implying an increase of 19.1% from the year-ago reported figure on 3.9% higher revenues of $43.6 billion. The consensus estimate for 2023 earnings stands at $16.58, implying an increase of 10.8% from the year-ago reported figure on 8.8% higher revenues of $47.4 billion.
The expected long-term earnings growth is pegged at 10%.
It has a Growth Score of B.
Value Score
The stock carries an impressive Value Score of A. Value Score helps find stocks that are undervalued. Back-tested results have shown that stocks with a favorable Value Score, when combined with a solid Zacks Rank, are the best investment bets.
Growth Drivers
Solid commercial businesses, commercial P&C rate increases, improving underwriting margins, new business and strong renewal retention should continue to drive premiums. Chubb’s focus on capitalizing on the potential of middle-market businesses, both domestic and international, with the traditional core package as well as specialty products bodes well for growth.
Chubb expects continued growth and margin improvement in 2022, as it capitalizes on favorable underwriting conditions for commercial P&C businesses globally.
The pending acquisition of the life and non-life insurance companies of Cigna Corporation in seven Asia-Pacific markets testifies Chubb’s efforts to expand its presence in the Asia-Pacific region. The addition of Cigna’s business will boost Chubb’s A&H business as well as expand its Asia-based life insurance presence. Upon closing, Chubb’s Asia-Pacific portfolio will increase to $7 billion in premiums from $4 billion at present. Chubb expects to realize in excess of $80 million of expense savings with one-time integration costs of about $100 million.
With an improving rate environment, a solid investment portfolio and positive operating cash flow, investment income should rise. Chubb estimates the quarterly run rate to be in the range of $915-925 million in 2022 and increase thereafter.
Chubb has a strong capital position with sufficient cash generation capabilities and has $1.6 billion remaining under its share buyback authorization.
Impressive Dividend History
Chubb has increased dividends for the last 29 years. The dividend yield is 1.6%, better than the industry average of 0.3%. The insurer will propose a dividend hike of 3.7%.
Other Stocks to Consider
Some other top-ranked stocks from the property and casualty insurance sector are W.R. Berkley Corporation (WRB - Free Report) , American Financial Group, Inc. (AFG - Free Report) and United Fire Group (UFCS - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
W.R. Berkley’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 27.08%. Year to date, W.R. Berkley stock has increased 21.5%.
The Zacks Consensus Estimate for WRB’s 2022 and 2023 earnings has moved 7% and 5.1% north, respectively, in the past 60 days.
American Financial delivered a four-quarter average earnings surprise of 41.72%. Year to date, shares of American Financial has dropped 3.8%.
The Zacks Consensus Estimate for AFG’s 2022 and 2023 earnings has moved 9.8% and 6.9% north, respectively, in the past 60 days.
United Fire Group delivered a four-quarter average earnings surprise of 270.83%. Year to date, the insurer has rallied 36.8%.
The Zacks Consensus Estimate for UFGS’ 2022 earnings has moved 23.5% north in the past 30 days and implies a 46.2% increase from the year-ago reported figure.