On Jan 6, Zacks Investment Research upgraded United Insurance Holdings Corp. (UIHC) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
United Insurance has witnessed rising earnings estimates on the back of its inorganic growth story along with policies approval and dividend hikes.
United Insurance expects to ramp up its growth profile with the recent acquisition of Family Security Holdings, LLC and its wholly owned subsidiaries Family Security Insurance Company and Family Security Underwriters, LLC. These buyouts will bolster its presence in Louisiana and also help it enter the Hawaii homeowners’ market.
Policies approval is important for top-line growth. A wholly-owned subsidiary of the company – United Property & Casualty Insurance Company – assumed more than 37,000 personal and commercial residential policies from Citizens Property Insurance Corporation in Nov 2014 resulting in $74 million in-force premiums. This will lead to an improvement in the book of business.
Additionally, the company has recently been permitted to write property and casualty insurance in the states of Connecticut, Delaware, Louisiana, Maryland, Mississippi and Virginia, thereby increasing its activity to fifteen states.
The company is focused on sharing more profits and enhancing shareholder value. As of last year, the board of directors approved a 33% hike in its dividend. The new payout of 4 cents yields 0.76%.
Moreover, the company scaled a 52-week high of $22.44 per share on Jan 2 with one-year return of 60.5%, ahead of NASDAQ’s return of 14.4%.
With respect to earnings performance this property and casualty insurer has delivered positive surprises in the trailing quarters with an average beat of 45.41%. Strong performance prompted upward revisions in Zacks Consensus Estimate over the last 90 days. For 2014, the Zacks Consensus Estimate increased by 4.9% to $1.91 and for 2015 it rose 4.2% to $1.72. The long term growth is targeted at 20%.
Other Stocks to Consider
Investors may be interested in stocks like The Allstate Corp. (ALL), Arch Capital Group Ltd. (ACGL) and W.R. Berkley Corp. (WRB), all of which sport the same Zacks Rank as United Insurance.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment