The board of directors of White Mountains Insurance Group, Ltd. WTM has approved a new buyback authorization for up to an additional 1 million shares.
The latest approval takes the authorization to 1.4 million shares in total, given that the company has approximately 0.4 million shares left under its existing share repurchase program. Last August, the board authorized the company to buy back 0.5 million shares.
White Mountains Insurance has always engaged in share buybacks to lower share count and thus, enhance shareholders’ value by returning more to them. In 2015, the company spent $284 million to buy back 3.9 million shares.
In addition to the recent approval, the company also declared an annual dividend of $1 per share, which will be paid on Mar 30 to shareholders on record as of Mar 21, 2016. Based on yesterday’s closing price, the dividend yield of the company translates to 0.13%.
Sufficient liquidity, owing to an overall solid operational performance, should continue to support such buyback activities in the future. Moreover, White Mountain’s capital deployment strategy through share buybacks and dividend payments makes it an attractive pick for yield-seeking investors. With respect to the surprise trend, this Zacks Rank #2 (Buy) property and casualty (P&C) insurer delivered positive surprises in three of the last four quarters with an average beat of 18.15%.
Stocks to Consider
Investors looking to invest in other stocks in the P&C industry might consider Chubb Limited CB, Markel Corp. MKL and The Hanover Insurance Group, Inc. THG. Each of these stocks sports a Zacks Rank #1 (Strong Buy).
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