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Arch Capital Group (ACGL) Stock Drops Despite Market Gains: Important Facts to Note

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Arch Capital Group (ACGL - Free Report) closed the most recent trading day at $89.86, moving -2.6% from the previous trading session. The stock's performance was behind the S&P 500's daily gain of 0.47%. Meanwhile, the Dow gained 0.11%, and the Nasdaq, a tech-heavy index, added 0.94%.

Coming into today, shares of the property and casualty insurer had gained 1.7% in the past month. In that same time, the Finance sector gained 2.42%, while the S&P 500 gained 2.32%.

Investors will be eagerly watching for the performance of Arch Capital Group in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be $1.76, reflecting a 11.56% decrease from the same quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $4.81 billion, indicating a 9.79% growth compared to the corresponding quarter of the prior year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $8.13 per share and revenue of $19.02 billion, which would represent changes of -12.39% and +14.4%, respectively, from the prior year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Arch Capital Group. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.03% higher. Right now, Arch Capital Group possesses a Zacks Rank of #3 (Hold).

In terms of valuation, Arch Capital Group is currently trading at a Forward P/E ratio of 11.35. For comparison, its industry has an average Forward P/E of 11.55, which means Arch Capital Group is trading at a discount to the group.

One should further note that ACGL currently holds a PEG ratio of 5.65. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Insurance - Property and Casualty industry had an average PEG ratio of 2.49 as trading concluded yesterday.

The Insurance - Property and Casualty industry is part of the Finance sector. This industry, currently bearing a Zacks Industry Rank of 32, finds itself in the top 13% echelons of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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