On Dec 7, 2015, we issued an updated research report on Amerisafe, Inc. AMSF.
Amerisafe has to its credit 29 years of operating history as a specialty provider of workers’ compensation insurance for small- to mid-sized employers engaged in high-hazard industries.
Amerisafe is a renowned name in its industry in terms of profitable underwriting, as reflected by solid operating and financial performances in the last couple of years. We appreciate Amerisafe’s ability to maintain combined ratios, at more favorable levels than its peers. The company’s combined ratio has stayed below 100% in the past nine years save 2011, signifying underwriting profitability.
The line of business that Amerisafe follows has been profitable because it brings to the company higher premium due to inherent workplace dangers associated with such policies. Notably, the company has maintained a niche position in insuring employers engaged in hazardous industries.
Amerisafe has been witnessing consistent growth in book value per share. This is primarily owing to several factors such as higher premiums paid by policyholders, the strategy of employing a proactive and disciplined approach in underwriting capabilities, and prudent capital management. The company’s return on equity has also been witnessing consistent and noticeable improvement.
Moreover, Amerisafe has always taken extra care in managing its capital and returning value to its shareholders. After paying its first regular cash dividend in Mar 2013, the company hiked its dividend in 2014 and 2015. Last quarter, it even paid an extraordinary dividend.
Amerisafe currently holds a Zacks Rank #2 (Buy). Investors interested in the insurance space may also consider stocks like Assured Guaranty Ltd. AGO, Old Republic International Corporation ORI and Employers Holdings, Inc. EIG. While Assured Guaranty and Old Republic carry a Zacks Rank #1 (Strong Buy), Employers Holdings carries a Zacks Rank #2.
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