W.R. Berkley Corporation (WRB - Free Report) , which has successfully met the growing demands and expectations of clients for years through a solid product and service portfolio, is witnessing a continued improvement in premiums. This sustained growth can be attributed to the property and casualty (P&C) insurer’s establishment of startup units. We expect this momentum to remain in the near term on the back of an increased market penetration, rate improvements and a strong economy.
Higher premiums from the emerging markets should continue to drive growth at its international business.
Further, the insurer has been experiencing rate increases over the past few years, which in turn, resulted in higher premiums.
On the back of rising interest rates, the P&C insurer has been experiencing better investment results and the same is anticipated in the future.
Notably, W.R. Berkley has a favorable Value Score of B. Back-tested results have shown that stocks with an impressive Value Scores of A or B when combined with a top Zacks Rank #1 (Strong Buy) or 2 (Buy) become best investment bets.
In addition, a robust capital position aids the company to add shareholder value via share buybacks and dividend hikes, thus increasing investor confidence in the stock. With regard to capital deployment, the company has so far returned $79 million in total capital including $61 million as special dividends. In fact, the company also paid a special dividend of 50 cents per share on Nov 9, 2018, marking its ninth special dividend since 2012. Shareholder-friendly moves like this makes the stock an attractive pick for yield-seeking investors.
Shares of this Zacks Rank #2 (Buy) P&C insurer have gained 8.3% year to date, outperforming the industry's increase of 0.9%. We expect the aforementioned strengths to drive the stock higher in the near term.
The consensus mark for current-year earnings per share is pegged at $4.03, representing a year-over-year surge of nearly 63.8% on 2.2% increase in revenues of $7.2 billion. The company's long-term growth stands at 9%.
With respect to its surprise history, the company pulled off positive surprises in the last four reported quarters, the average being 17.73%.
Other Stocks That Warrant a Look
Investors interested in some other top-ranked stocks from the insurance industry can also consider The Progressive Corporation (PGR - Free Report) , Radian Group Inc. (RDN - Free Report) and MetLife, Inc. (MET - Free Report) , each carrying a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Progressive Corporation offers personal and commercial auto insurance, residential property insurance and other specialty property-casualty insurance and related services, primarily in the United States. The company delivered positive surprises in all the trailing four reported quarters, the average being 13.48%.
Radian Group provides mortgage and real estate products and services in the United States. The company pulled off positive surprises in all the last four reported quarters, the average being 11.33%.
MetLife engages in the insurance, annuities, employee benefits and asset management businesses. The company came up with positive surprises in the preceding four reported quarters, the average being 9.67%.
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