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 Portfolio Now
Read MoreHide Full Article
Chubb Limited’s (CB - Free Report) compelling portfolio, strong renewal retention, positive rate increases, strategic initiatives to fuel profitability, solid capital position and favorable growth estimates make it 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, CB has a decent record of beating estimates. Its earnings beat estimates in three of the last four quarters, while missing in one, the average being 3.36%. Earnings in the last five years grew 10.6%.
Return on equity was 13.6% in the trailing 12 months, better than the industry average of 6.7%.
Zacks Rank & Price Performance
Chubb currently carries a Zacks Rank #2 (Buy). In the last three months, the stock gained 7.3% versus the industry’s growth of 2.8%.
Image Source: Zacks Investment Research
Optimistic Growth Projections
The Zacks Consensus Estimate for CB’s 2023 earnings is pegged at $18.18 per share, indicating a 19.3% increase from the year-ago reported figure on 8.8% higher revenues of $48.3 billion. The consensus estimate for 2024 earnings is pegged at $19.86 per share, indicating a 9.2% increase from the year-ago reported figure on 6.4% higher revenues of $51.4 billion.
The expected long-term earnings growth is pegged at 10%.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2023 and 2024 has moved 0.8% and 0.1% north, respectively, in the past 60 days, reflecting analyst optimism.u
Business Tailwinds
Premiums should continue benefiting from strong commercial businesses, commercial P&C rate increases, improving underwriting margins, new business and strong renewal retention. Chubb has an extensive local presence globally. Its several distribution agreements have expanded its network, thus boosting its market presence.
Chubb’s growth strategy includes an increased focus on capitalizing on the potential of middle-market businesses (both domestic and international), along with enhancing the traditional core package and specialty products.
CB has been focused on expanding its presence in the Asia Pacific region. The acquisition of the life and non-life insurance companies of Cigna Corporation in seven Asia Pacific markets testifies to this strategic effort. The addition of Cigna’s business will boost Chubb’s A&H business and expand its Asia life insurance presence.
With an improving rate environment, a solid investment portfolio and a positive operating cash flow, investment income is poised to grow. Chubb estimates investment income to be $1.27 billion in the third quarter of 2023 and increase in the subsequent future quarters.
Chubb’s strong capital position with cash generation capabilities helped it increase dividends for the last 30 years. The dividend yield is 1.6%, better than the industry average of 0.3%. CB has $5 billion remaining under its share buyback authorization.
CB has a Value Score of A. Back-tested results have shown that stocks with a Value Score of A or B, combined with a Zacks Rank #1 (Strong Buy) or #2, offer better returns.
Other Stocks to Consider
Some other top-ranked stocks from the property and casualty insurance industry are ProAssurance Corporation (PRA - Free Report) , Axis Capital Holdings Limited (AXS - Free Report) and Cincinnati Financial Corporation (CINF - Free Report) . ProAssurance currently sports a Zacks Rank #1, and Axis Capital and Cincinnati Financial carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
ProAssurance has a decent record of beating earnings estimates in two of the last four quarters and missing in two. PRA has gained 4.6% so far this year.
The Zacks Consensus Estimate for PRA’s 2024 earnings per share is pegged at 83 cents, indicating a year-over-year increase of 143.5%.
Axis Capital has a solid track record of beating earnings estimates in three of the last four quarters and missing in one, the average being 9.75%. Year to date, AXS has gained 3%.
The Zacks Consensus Estimate for AXS’ 2023 and 2024 earnings per share is pegged at $8.41 and $9.31, indicating year-over-year increases of 44.7% and 10.7%, respectively.
Cincinnati Financial has a solid record of beating earnings estimates in three of the last four quarters and missing in one, the average being 25.25%. Year to date, CINF has lost 2.3%.
The Zacks Consensus Estimate for CINF’s 2023 and 2024 earnings per share is pegged at $5 and $5.88, indicating year-over-year increases of 17.9% and 17.7%, respectively.
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 Portfolio Now
Chubb Limited’s (CB - Free Report) compelling portfolio, strong renewal retention, positive rate increases, strategic initiatives to fuel profitability, solid capital position and favorable growth estimates make it 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, CB has a decent record of beating estimates. Its earnings beat estimates in three of the last four quarters, while missing in one, the average being 3.36%. Earnings in the last five years grew 10.6%.
Return on equity was 13.6% in the trailing 12 months, better than the industry average of 6.7%.
Zacks Rank & Price Performance
Chubb currently carries a Zacks Rank #2 (Buy). In the last three months, the stock gained 7.3% versus the industry’s growth of 2.8%.
Image Source: Zacks Investment Research
Optimistic Growth Projections
The Zacks Consensus Estimate for CB’s 2023 earnings is pegged at $18.18 per share, indicating a 19.3% increase from the year-ago reported figure on 8.8% higher revenues of $48.3 billion. The consensus estimate for 2024 earnings is pegged at $19.86 per share, indicating a 9.2% increase from the year-ago reported figure on 6.4% higher revenues of $51.4 billion.
The expected long-term earnings growth is pegged at 10%.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2023 and 2024 has moved 0.8% and 0.1% north, respectively, in the past 60 days, reflecting analyst optimism.u
Business Tailwinds
Premiums should continue benefiting from strong commercial businesses, commercial P&C rate increases, improving underwriting margins, new business and strong renewal retention. Chubb has an extensive local presence globally. Its several distribution agreements have expanded its network, thus boosting its market presence.
Chubb’s growth strategy includes an increased focus on capitalizing on the potential of middle-market businesses (both domestic and international), along with enhancing the traditional core package and specialty products.
CB has been focused on expanding its presence in the Asia Pacific region. The acquisition of the life and non-life insurance companies of Cigna Corporation in seven Asia Pacific markets testifies to this strategic effort. The addition of Cigna’s business will boost Chubb’s A&H business and expand its Asia life insurance presence.
With an improving rate environment, a solid investment portfolio and a positive operating cash flow, investment income is poised to grow. Chubb estimates investment income to be $1.27 billion in the third quarter of 2023 and increase in the subsequent future quarters.
Chubb’s strong capital position with cash generation capabilities helped it increase dividends for the last 30 years. The dividend yield is 1.6%, better than the industry average of 0.3%. CB has $5 billion remaining under its share buyback authorization.
CB has a Value Score of A. Back-tested results have shown that stocks with a Value Score of A or B, combined with a Zacks Rank #1 (Strong Buy) or #2, offer better returns.
Other Stocks to Consider
Some other top-ranked stocks from the property and casualty insurance industry are ProAssurance Corporation (PRA - Free Report) , Axis Capital Holdings Limited (AXS - Free Report) and Cincinnati Financial Corporation (CINF - Free Report) . ProAssurance currently sports a Zacks Rank #1, and Axis Capital and Cincinnati Financial carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
ProAssurance has a decent record of beating earnings estimates in two of the last four quarters and missing in two. PRA has gained 4.6% so far this year.
The Zacks Consensus Estimate for PRA’s 2024 earnings per share is pegged at 83 cents, indicating a year-over-year increase of 143.5%.
Axis Capital has a solid track record of beating earnings estimates in three of the last four quarters and missing in one, the average being 9.75%. Year to date, AXS has gained 3%.
The Zacks Consensus Estimate for AXS’ 2023 and 2024 earnings per share is pegged at $8.41 and $9.31, indicating year-over-year increases of 44.7% and 10.7%, respectively.
Cincinnati Financial has a solid record of beating earnings estimates in three of the last four quarters and missing in one, the average being 25.25%. Year to date, CINF has lost 2.3%.
The Zacks Consensus Estimate for CINF’s 2023 and 2024 earnings per share is pegged at $5 and $5.88, indicating year-over-year increases of 17.9% and 17.7%, respectively.