Everest Re Increases Dividend by 27%, Ups Share Buyback

In an effort to increase shareholders’ returns, the board of directors of Everest Re Group Ltd. (RE) approved a 27% increase in its regular quarterly dividend to 95 cents per share from 75 cents paid in third-quarter 2014.

The meatier dividend will be paid on or before Dec 17, to shareholders of record as of Dec 3.

This dividend increase comes on the back of the company’s robust capital. Everest Re generated strong operating cash flows of $926 million for the first nine months of 2014 compared with $825 million in 2013.

Everest Re also announced an expansion by 5 million shares to its share buyback plan. This takes the present repurchase authorization to 6.8 million shares.

Over the first nine months of 2014, the company returned $503 million to shareholders through dividends and stock repurchases compared with $620 million over the same time frame in 2013.

With its intelligent capital management, the company’s shareholder value creation has averaged 14% annually over the last 5 years.

We believe that a strong franchise, seasoned management team, disciplined underwriting culture, astute capital management and conservative and high-quality balance sheet bode well for the company’s long-term growth and operating results. The company’s dividend growth track would also be benefited by its sound fundamentals.

Everest Re carries a Zacks Rank #3 (Hold). Better-ranked players include AmTrust Financial Services, Inc. (AFSI), Arch Capital Group Ltd. (ACGL) and Atlas Financial Holdings, Inc. (AFH). All these stocks sport a Zacks Rank #1 (Strong Buy).