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Here's Why Assurant (AIZ) Stock is Investors' Favorite Now
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Shares of Assurant Inc. (AIZ - Free Report) have rallied 32.6% year to date, outperforming 1.9%, 14.9% and 25% growth of the industry, the Finance sector and the Zacks S&P 500 composite, respectively, in the same time frame. With a market capitalization of $8.7 billion, the average volume of shares traded in the last three months was 0.4 million.
The well-performing Global Lifestyle business, growth in fee-based capital-light businesses and solid capital management continue to drive Assurant. The Zacks Consensus Estimate for 2024 earnings has moved north by 0.5% in the past seven days, reflecting analysts’ optimism.
Assurant, sporting a Zacks Rank #1 (Strong Buy), has a decent earnings surprise history of surpassing expectations in each of the last five quarters. The company’s earnings increased by 18.3% in the past five years, better than the industry average of 4.5%.
It has a VGM Score of A. This helps to identify stocks with the most attractive value, growth and momentum.
Image Source: Zacks Investment Research
Can AIZ Retain the Momentum?
The Zacks Consensus Estimate for 2024 earnings is pegged at $15.19 per share, indicating an increase of 4.2% on 4% higher revenues of $11.4 billion.
The long-term earnings growth rate is currently pegged at 14.6%, better than the industry average of 12.5%. It has a Growth Score of B. This style score analyzes the growth prospects of a company.
Assurant’s focus on growing fee-based capital-light businesses that presently constitute 52% of segmental revenues bodes well for growth. Management estimates that contribution from the same will continue to grow in double digits over the longer term.
Better performance in Homeowners reflecting higher lender-placed net earned premiums should drive better results at Global Housing. At the same time, growth across Connected Living and Global Automotive should drive Global Lifestyle.
The insurer remains focused on ramping up the Connected Living platform, deploying innovative products and services, and adding new partnerships. These initiatives are expected to double the margins of Connected Living to 8% over the long term.
Investment income, that has been witnessing an increase in net investment income over the past few years, should benefit from higher yields on fixed-maturity securities.
AIZ has a solid capital management policy in place. While it has been increasing dividends for the last 19 straight years, the company has $174 million remaining under its current share buyback authorization. Notably, its free cash flow conversion has remained more than 100% over the last many quarters, reflecting its solid earnings.
Attractive Valuation
The stock is trading at a price to book value of 1.9, lower than the industry average of 2.6. It has a Value Score of A. This style score helps find the most attractive value stocks. Back-tested results have shown that stocks with a Value Score of A or B and a Zacks Rank #1 or 2 (Buy) offer better returns.
Other Stocks to Consider
Some other top-ranked stocks from the insurance industry are CNO Financial Group (CNO - Free Report) , Everest Group, Ltd. (EG - Free Report) and The Hartford Financial Services Group (HIG - Free Report) .
The Zacks Consensus Estimate for CNO’s 2024 earnings indicates an increase of 9.7% from the 2023 estimated figure and has moved up 3 cents in the past seven days. Year to date, CNO’s shares have gained 22.2%. It carries a Zacks Rank #2.
The Zacks Consensus Estimate for Everest Group’s 2024 earnings indicates an improvement of 11% from the 2023 estimated figure and has inched up 3 cents in the past seven days. EG delivered a four-quarter average earnings surprise of 24.50%. Year to date, its shares have climbed 6.8%. It sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Hartford Financial delivered a four-quarter average earnings surprise of 10.81%. Year to date, HIG’s shares have jumped 5%. The Zacks Consensus Estimate for HIG’s 2024 earnings suggests an increase of 19.6% from the year-ago estimated figure and has increased 2.4% in the past 60 days. It carries a Zacks Rank #2.
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Here's Why Assurant (AIZ) Stock is Investors' Favorite Now
Shares of Assurant Inc. (AIZ - Free Report) have rallied 32.6% year to date, outperforming 1.9%, 14.9% and 25% growth of the industry, the Finance sector and the Zacks S&P 500 composite, respectively, in the same time frame. With a market capitalization of $8.7 billion, the average volume of shares traded in the last three months was 0.4 million.
The well-performing Global Lifestyle business, growth in fee-based capital-light businesses and solid capital management continue to drive Assurant. The Zacks Consensus Estimate for 2024 earnings has moved north by 0.5% in the past seven days, reflecting analysts’ optimism.
Assurant, sporting a Zacks Rank #1 (Strong Buy), has a decent earnings surprise history of surpassing expectations in each of the last five quarters. The company’s earnings increased by 18.3% in the past five years, better than the industry average of 4.5%.
It has a VGM Score of A. This helps to identify stocks with the most attractive value, growth and momentum.
Image Source: Zacks Investment Research
Can AIZ Retain the Momentum?
The Zacks Consensus Estimate for 2024 earnings is pegged at $15.19 per share, indicating an increase of 4.2% on 4% higher revenues of $11.4 billion.
The long-term earnings growth rate is currently pegged at 14.6%, better than the industry average of 12.5%. It has a Growth Score of B. This style score analyzes the growth prospects of a company.
Assurant’s focus on growing fee-based capital-light businesses that presently constitute 52% of segmental revenues bodes well for growth. Management estimates that contribution from the same will continue to grow in double digits over the longer term.
Better performance in Homeowners reflecting higher lender-placed net earned premiums should drive better results at Global Housing. At the same time, growth across Connected Living and Global Automotive should drive Global Lifestyle.
The insurer remains focused on ramping up the Connected Living platform, deploying innovative products and services, and adding new partnerships. These initiatives are expected to double the margins of Connected Living to 8% over the long term.
Investment income, that has been witnessing an increase in net investment income over the past few years, should benefit from higher yields on fixed-maturity securities.
AIZ has a solid capital management policy in place. While it has been increasing dividends for the last 19 straight years, the company has $174 million remaining under its current share buyback authorization. Notably, its free cash flow conversion has remained more than 100% over the last many quarters, reflecting its solid earnings.
Attractive Valuation
The stock is trading at a price to book value of 1.9, lower than the industry average of 2.6. It has a Value Score of A. This style score helps find the most attractive value stocks. Back-tested results have shown that stocks with a Value Score of A or B and a Zacks Rank #1 or 2 (Buy) offer better returns.
Other Stocks to Consider
Some other top-ranked stocks from the insurance industry are CNO Financial Group (CNO - Free Report) , Everest Group, Ltd. (EG - Free Report) and The Hartford Financial Services Group (HIG - Free Report) .
The Zacks Consensus Estimate for CNO’s 2024 earnings indicates an increase of 9.7% from the 2023 estimated figure and has moved up 3 cents in the past seven days. Year to date, CNO’s shares have gained 22.2%. It carries a Zacks Rank #2.
The Zacks Consensus Estimate for Everest Group’s 2024 earnings indicates an improvement of 11% from the 2023 estimated figure and has inched up 3 cents in the past seven days. EG delivered a four-quarter average earnings surprise of 24.50%. Year to date, its shares have climbed 6.8%. It sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Hartford Financial delivered a four-quarter average earnings surprise of 10.81%. Year to date, HIG’s shares have jumped 5%. The Zacks Consensus Estimate for HIG’s 2024 earnings suggests an increase of 19.6% from the year-ago estimated figure and has increased 2.4% in the past 60 days. It carries a Zacks Rank #2.