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Should You Retain Axis Capital (AXS) Stock in Your Portfolio?
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AXIS Capital Holdings Limited (AXS - Free Report) is well-poised for growth, given its better pricing, margin expansion, new business opportunities as well as solid market presence.
Growth Projections
The Zacks Consensus Estimate for AXIS Capital’s 2022 and 2023 earnings per share is pegged at $5.50 and $7.22, indicating an increase of 7.4% and 31.2%, respectively, from the corresponding year-ago reported figure. The long-term earnings growth rate is currently pegged at 5%.
Estimate Revision
The Zacks Consensus Estimate for 2022 and 2023 has moved 10% and 0.1% north, respectively, in the past 60 days. This should instill investors' confidence in the stock.
Earnings Surprise History
AXIS Capital has a decent earnings surprise history. Its bottom line beat earnings estimates in six of the last seven quarters.
Zacks Rank & Price Performance
AXIS Capital currently carries a Zacks Rank #3 (Hold). The stock has rallied 7.9%, outperforming the industry’s increase of 5.2% in the past year.
Image Source: Zacks Investment Research
Style Score
The company has a favorable VGM Score of A. VGM Score helps identify stocks with the most attractive value, best growth and the most promising momentum.
Return on Equity (ROE)
AXIS Capital’s ROE for the trailing 12 months is 12.5%, expanded 690 basis points year over year. This reflects its efficiency in utilizing shareholders’ funds.
Business Tailwinds
The property and casualty insurer remains poised to gain from repositioning of portfolio and markets offering profitable growth, lower volatility, strong market presence, better pricing as well as margin expansion.
Pricing improved in virtually every line of business with many lines continuing to witness strong double-digit increases. AXIS Capital expects disciplined pricing to persist in both insurance and reinsurance in 2023.
The Insurance segment should continue to gain from favorable market conditions, increased new business opportunities, rate increases on renewal and continued strong retentions.
The Reinsurance segment is expected to benefit from increases in accident and health, motor, catastrophe, and credit and surety lines as well as increases in liability and professional lines owing to premium adjustments, primarily related to favorable market conditions, new business growth and increased rates on business in North America and Global Markets.
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 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 (2015 – 2022) of 5%, driven by solid earnings. AXS also has a $65 million share buyback program through 2022 under its authorization.
Stocks to Consider
Some better-ranked stocks from the property and casualty insurance industry are Kinsale Capital Group, Inc. (KNSL - Free Report) , W.R. Berkley Corporation (WRB - Free Report) and Root, Inc. (ROOT - Free Report) . While Kinsale Capital sports a Zacks Rank #1 (Strong Buy), W.R. Berkley and Root carry Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Kinsale Capital’s earnings surpassed estimates in all the last four quarters, the average being 15.16%. In the past year, Kinsale Capital has gained 30%.
The Zacks Consensus Estimate for KNSL’s 2022 and 2023 earnings implies a respective year-over-year rise of 27.5% and 21.9%.
The bottom line of W.R. Berkley surpassed earnings estimates in each of the last four quarters, the average beat being 25.63%. In the past year, the insurer has gained 37.2%.
The Zacks Consensus Estimate for W.R. Berkley’s 2022 and 2023 earnings has moved 5.1% and 3.4% north, respectively, in the past 60 days.
Root delivered a trailing four-quarter average earnings surprise of 22.44%. In the past year, ROOT has lost 90.5%.
The Zacks Consensus Estimate for ROOT’s 2022 and 2023 earnings indicates a respective year-over-year increase of 44.7% and 23.9%.
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Should You Retain Axis Capital (AXS) Stock in Your Portfolio?
AXIS Capital Holdings Limited (AXS - Free Report) is well-poised for growth, given its better pricing, margin expansion, new business opportunities as well as solid market presence.
Growth Projections
The Zacks Consensus Estimate for AXIS Capital’s 2022 and 2023 earnings per share is pegged at $5.50 and $7.22, indicating an increase of 7.4% and 31.2%, respectively, from the corresponding year-ago reported figure. The long-term earnings growth rate is currently pegged at 5%.
Estimate Revision
The Zacks Consensus Estimate for 2022 and 2023 has moved 10% and 0.1% north, respectively, in the past 60 days. This should instill investors' confidence in the stock.
Earnings Surprise History
AXIS Capital has a decent earnings surprise history. Its bottom line beat earnings estimates in six of the last seven quarters.
Zacks Rank & Price Performance
AXIS Capital currently carries a Zacks Rank #3 (Hold). The stock has rallied 7.9%, outperforming the industry’s increase of 5.2% in the past year.
Image Source: Zacks Investment Research
Style Score
The company has a favorable VGM Score of A. VGM Score helps identify stocks with the most attractive value, best growth and the most promising momentum.
Return on Equity (ROE)
AXIS Capital’s ROE for the trailing 12 months is 12.5%, expanded 690 basis points year over year. This reflects its efficiency in utilizing shareholders’ funds.
Business Tailwinds
The property and casualty insurer remains poised to gain from repositioning of portfolio and markets offering profitable growth, lower volatility, strong market presence, better pricing as well as margin expansion.
Pricing improved in virtually every line of business with many lines continuing to witness strong double-digit increases. AXIS Capital expects disciplined pricing to persist in both insurance and reinsurance in 2023.
The Insurance segment should continue to gain from favorable market conditions, increased new business opportunities, rate increases on renewal and continued strong retentions.
The Reinsurance segment is expected to benefit from increases in accident and health, motor, catastrophe, and credit and surety lines as well as increases in liability and professional lines owing to premium adjustments, primarily related to favorable market conditions, new business growth and increased rates on business in North America and Global Markets.
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 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 (2015 – 2022) of 5%, driven by solid earnings. AXS also has a $65 million share buyback program through 2022 under its authorization.
Stocks to Consider
Some better-ranked stocks from the property and casualty insurance industry are Kinsale Capital Group, Inc. (KNSL - Free Report) , W.R. Berkley Corporation (WRB - Free Report) and Root, Inc. (ROOT - Free Report) . While Kinsale Capital sports a Zacks Rank #1 (Strong Buy), W.R. Berkley and Root carry Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Kinsale Capital’s earnings surpassed estimates in all the last four quarters, the average being 15.16%. In the past year, Kinsale Capital has gained 30%.
The Zacks Consensus Estimate for KNSL’s 2022 and 2023 earnings implies a respective year-over-year rise of 27.5% and 21.9%.
The bottom line of W.R. Berkley surpassed earnings estimates in each of the last four quarters, the average beat being 25.63%. In the past year, the insurer has gained 37.2%.
The Zacks Consensus Estimate for W.R. Berkley’s 2022 and 2023 earnings has moved 5.1% and 3.4% north, respectively, in the past 60 days.
Root delivered a trailing four-quarter average earnings surprise of 22.44%. In the past year, ROOT has lost 90.5%.
The Zacks Consensus Estimate for ROOT’s 2022 and 2023 earnings indicates a respective year-over-year increase of 44.7% and 23.9%.