Zacks Investment Research upgraded The Chubb Corporation (CB) to a Zacks Rank #1 (Strong Buy) on Dec 27, 2013.
Why the Upgrade?
Chubb Corporation witnessed upward estimate revisions on the back of solid earnings results. This property and casualty insurer delivered positive earnings surprises in the last 4 quarters with an average beat of 49.5%. Moreover, the company provided an enhanced guidance for full-year 2013.
In the last reported quarter, Chubb Corporation’s operating earnings per share came in at $2.06, surpassing the Zacks Consensus Estimate by 12%. The earnings also improved 4% year over year. Earnings were primarily aided by solid growth in premiums written and a decrease in losses and loss expenses.
Other important metrics like combined ratio showed an improvement of 60 basis points and book value improved 1.7% year over year during the quarter. The company also continued with its share repurchases and boosted investor confidence on the stock.
Based on its progress over the first nine months of 2013, Chubb Corporation raised its earnings per share projection for full-year 2013 to $7.90–$8.00 from $7.30–$7.50. The Zacks Consensus Estimate for full-year 2013 is pegged at $7.96 per share, which lies within the company guided range. This estimate also reflects a year-over-year improvement of 52.1%. The Zacks Consensus Estimate for full-year 2014 increased nearly 1% to $7.40 per share as many estimates were revised higher over the last 60 days. The long-term expected earnings growth rate for this stock is 10.4%
Chubb Corporation is scheduled to release its fourth-quarter 2013 results on Jan 30, 2014. The Zacks Consensus Estimate for the fourth quarter is pegged at $1.99 per share, representing an enormous year-over-year improvement of 1146%.
Other Stocks to Consider
Other players in the property and casualty insurance space, which look attractive at current levels, include Allied World Assurance Company Holdings, AG (AWH), Cincinnati Financial Corp. (CINF) and CNA Financial Corporation (CNA). All these stocks carry the same Zacks Rank as Chubb Corporation.
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