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Why You Should Retain AXIS Capital (AXS) Stock in Portfolio
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AXIS Capital Holdings Limited’s (AXS - Free Report) focus on repositioning its portfolio and markets offering profitable growth, lower volatility, strong market presence, better pricing, margin expansion and effective capital deployment make it worth retaining in one’s portfolio.
The insurer has a solid track record of delivering positive earnings surprise in the last nine quarters.
AXS has a VGM Score of A. This helps to identify stocks with the most attractive value, growth and momentum.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2022 and 2023 earnings has moved 6.1% and 6.3% north, respectively in the past 30 days, reflecting analysts’ optimism.
Zacks Rank & Price Performance
AXIS Capital currently carries a Zacks Rank #3 (Hold). Year to date, the stock has gained 1.9% compared with the industry’s increase of 2.3%.
Image Source: Zacks Investment Research
Return on Equity (ROE)
Return on equity was 11.8% in the trailing twelve months, better than the industry average of 5.7%.
Growth Projections
The Zacks Consensus Estimate for AXIS Capital’s 2022 earnings is pegged at $6.41, indicating a 25.2% increase from the year-ago reported figure on 2% higher revenues of $5.29 million. The consensus estimate for 2023 earnings is pegged at $7.03, indicating a 9.7% increase from the year-ago reported figure on 9.8% higher revenues of $5.8 million.
The expected long-term earnings growth is pegged at 5%. It has a Growth Score of B. This style score analyzes the growth prospects of a company.
Business Tailwinds
The company continues to build on its Specialty Insurance, Reinsurance plus Accident and Health. AXIS Capital remains focused on growing its business lines that are likely to provide a solid double-digit return on equity opportunities. Its pet insurance, marine cargo, cyber and renewable energy insurance businesses are in sync with its growth strategy.
AXS aims for improved risk-adjusted return through rate increase, prudent underwriting and PML reductions supported by third-party capital. This in turn should drive margin improvement.
The insurance industry has been witnessing accelerated digitalization. AXS has made investments in technology that help in effective usage of data, aid higher-value processes and activities, support new lines of business and enable efficient operations.
AXIS Capital expects disciplined pricing to persist in both insurance and reinsurance through 2023.
AXIS Capital eyes a low-90s combined ratio to fuel attractive ROE.
Effective Capital Deployment
Axis Capital has an impressive dividend history, boasting one of the highest dividend yields among its peers. It hiked dividends for the last 18 years at a nine-year CAGR (2014 – 2021) of 5.3%, driven by solid earnings. Its dividend yield is currently 3.3%, way above the industry average of 0.4%.
The insurer also has a $100 million share buyback program through 2022 under its authorization.
W.R. Berkley’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 29.95%. Year to date, W.R. Berkley stock has gained 23.7%.
The Zacks Consensus Estimate for WRB’s 2022 and 2023 earnings per share indicates year-over-year increases of 50.6% and 10.4%, respectively.
Arch Capital’s earnings surpassed estimates in three of the last four quarters and missed in one, the average beat being 33.64%. Year to date, ACGL has gained 7.3%.
The Zacks Consensus Estimate for ACGL’s 2022 and 2023 earnings implies a 29.6% and 14.8% year-over-year increase, respectively.
The bottom line of ProAssurance surpassed earnings estimates in three of the last four quarters and missed in one, the average beat being 150.9%. Year to date, the insurer has lost 9.3%.
The Zacks Consensus Estimate for ProAssurance’s 2022 and 2023 earnings has moved 16.9% and 13.9% north, respectively, in the past seven days.
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Why You Should Retain AXIS Capital (AXS) Stock in Portfolio
AXIS Capital Holdings Limited’s (AXS - Free Report) focus on repositioning its portfolio and markets offering profitable growth, lower volatility, strong market presence, better pricing, margin expansion and effective capital deployment make it worth retaining in one’s portfolio.
The insurer has a solid track record of delivering positive earnings surprise in the last nine quarters.
AXS has a VGM Score of A. This helps to identify stocks with the most attractive value, growth and momentum.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2022 and 2023 earnings has moved 6.1% and 6.3% north, respectively in the past 30 days, reflecting analysts’ optimism.
Zacks Rank & Price Performance
AXIS Capital currently carries a Zacks Rank #3 (Hold). Year to date, the stock has gained 1.9% compared with the industry’s increase of 2.3%.
Image Source: Zacks Investment Research
Return on Equity (ROE)
Return on equity was 11.8% in the trailing twelve months, better than the industry average of 5.7%.
Growth Projections
The Zacks Consensus Estimate for AXIS Capital’s 2022 earnings is pegged at $6.41, indicating a 25.2% increase from the year-ago reported figure on 2% higher revenues of $5.29 million. The consensus estimate for 2023 earnings is pegged at $7.03, indicating a 9.7% increase from the year-ago reported figure on 9.8% higher revenues of $5.8 million.
The expected long-term earnings growth is pegged at 5%. It has a Growth Score of B. This style score analyzes the growth prospects of a company.
Business Tailwinds
The company continues to build on its Specialty Insurance, Reinsurance plus Accident and Health. AXIS Capital remains focused on growing its business lines that are likely to provide a solid double-digit return on equity opportunities. Its pet insurance, marine cargo, cyber and renewable energy insurance businesses are in sync with its growth strategy.
AXS aims for improved risk-adjusted return through rate increase, prudent underwriting and PML reductions supported by third-party capital. This in turn should drive margin improvement.
The insurance industry has been witnessing accelerated digitalization. AXS has made investments in technology that help in effective usage of data, aid higher-value processes and activities, support new lines of business and enable efficient operations.
AXIS Capital expects disciplined pricing to persist in both insurance and reinsurance through 2023.
AXIS Capital eyes a low-90s combined ratio to fuel attractive ROE.
Effective Capital Deployment
Axis Capital has an impressive dividend history, boasting one of the highest dividend yields among its peers. It hiked dividends for the last 18 years at a nine-year CAGR (2014 – 2021) of 5.3%, driven by solid earnings. Its dividend yield is currently 3.3%, way above the industry average of 0.4%.
The insurer also has a $100 million share buyback program through 2022 under its authorization.
Stocks to Consider
Some better-ranked stocks from the insurance industry are W.R. Berkley Corporation (WRB - Free Report) , Arch Capital Group (ACGL - Free Report) and ProAssurance Corporation (PRA - 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 29.95%. Year to date, W.R. Berkley stock has gained 23.7%.
The Zacks Consensus Estimate for WRB’s 2022 and 2023 earnings per share indicates year-over-year increases of 50.6% and 10.4%, respectively.
Arch Capital’s earnings surpassed estimates in three of the last four quarters and missed in one, the average beat being 33.64%. Year to date, ACGL has gained 7.3%.
The Zacks Consensus Estimate for ACGL’s 2022 and 2023 earnings implies a 29.6% and 14.8% year-over-year increase, respectively.
The bottom line of ProAssurance surpassed earnings estimates in three of the last four quarters and missed in one, the average beat being 150.9%. Year to date, the insurer has lost 9.3%.
The Zacks Consensus Estimate for ProAssurance’s 2022 and 2023 earnings has moved 16.9% and 13.9% north, respectively, in the past seven days.