HCC Insurance Upped to Buy

Zacks

On Nov 9, Zacks Investment Research upgraded HCC Insurance Holdings Inc. (HCC) to a Zacks Rank #2 (Buy).

Why the Upgrade?

HCC Insurance has been witnessing rising earnings estimates on the back of strong third-quarter 2013 results and an enhanced guidance for 2013. Moreover, this property and casualty insurer delivered positive earnings surprises in the last 4 quarters with an average beat of 29.5%. The long-term expected earnings growth rate for this stock is 8.5%.    

HCC Insurance reported third-quarter results on Oct 29. Non-GAAP earnings per share came in at 93 cents, surpassing the Zacks Consensus Estimate of 79 cents by nearly 18%.

The outperformance was largely aided by an improved top line, which grew 0.8% year over year. Revenues also surpassed the Zacks Consensus Estimate by 1%.

Gross premiums written for the quarter increased 2% to $678.9 million.

Based on its progress, the company raised its earnings per share projection for 2013 to $3.70–$3.80 from $3.20–$3.50.

The Zacks Consensus Estimate for 2013 increased 3.4% to $3.63 per share as all the estimates were revised higher over the last 30 days. The current estimate lies below the guidance range provided by HCC Insurance. For 2014, 2 of the 5 estimates were revised higher over the same time frame, lifting the Zacks Consensus Estimate by 0.8% to $3.62 per share.

Other Stocks to Consider

Property and casualty insurers Allied World Assurance Co. (AWH), Aspen Insurance Holdings Ltd. (AHL), and Cincinnati Financial Corp. (CINF) with a favorable Zacks Rank #1 (Strong Buy) are also worth considering.
 

Read the Full Research Report on HCC
Read the Full Research Report on CINF
Read the Full Research Report on AWH
Read the Full Research Report on AHL


Zacks Investment Research

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