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Assurant (AIZ) Up 30.7% in a Year: More Room for Growth?

·4 min read

Shares of Assurant, Inc. AIZ have gained 30.7% in a year against the industry's decrease of 3.5%. The Zacks S&P 500 composite has rallied 12.4% in the said time frame. With a market capitalization of $9.3 billion, the average volume of shares traded in the last three months was 0.5 million.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

The rally was largely driven by higher investment income, organic growth across distribution channels and sufficient liquidity.

The multi-line insurer has a decent earnings surprise history. The bottom line beat estimates in each of the last four quarters, the average being 17.03%.

Assurant has a favorable VGM Score of B. VGM Score helps to identify stocks with the most attractive value, best growth and the most promising momentum.

Will the Bull Run Continue?

Estimates for 2022 and 2023 have moved up nearly 1.3% and 0.07%, respectively, in the past 30 days, reflecting investors’ optimism.

The Zacks Consensus Estimate for 2022 and 2023 earnings per share is pegged at $12.06 and $13.98, indicating a year-over-year increase of 28.8% and 15.9%, respectively.

The expected long-term earnings growth rate is pegged at 17%, which compares favorably with the industry average of 11.5%.

Solid performance in Global Automotive and Connected Living is likely to drive the Global Lifestyle segment. Continued organic growth across distribution channels, better loss experience from select ancillary products and higher investment income should drive Global Automotive. Connected Living is likely to gain from higher trade-in volumes, higher international earnings and continued mobile subscriber growth in North America.

For 2022, Global Lifestyle adjusted EBITDA is expected to grow by low double-digits, driven mainly by mobile in Connected Living from global expansion in existing and new clients across device protection and trade-in and upgrade programs.

The Global Housing segment should gain from higher average insured values and premium rates in lender-placed and growth in multifamily housing.

For 2022, AIZ expects Global Housing’s adjusted EBITDA, excluding catastrophes, to grow by mid-to-high-single digits.

In January 2022, Assurant expanded its long-standing partnership with Telefonica to provide a comprehensive device trade-in program across several countries. This partnership is expected to expand the range of products and services that Assurant offers and thus boost this multi-line insurer’s capability to offer an enhanced customer experience, innovate and promote sustainable practices.

Assurant exited 2021 with liquidity of $1.05 billion, $827 million higher than the insurer’s current targeted minimum level of $225 million.

This Zacks Rank #3 (Hold) insurer implements capital initiatives to enhance shareholder value through cash dividends as well as share repurchase authorizations. AIZ boasts a consistent increase in dividends with the metric witnessing a nine-year CAGR (2014-2022) of 11.8%. From Jan 1 through Feb 4, 2022, Assurant repurchased additional shares, with $762 million remaining under the current repurchase authorization.

Stocks to Consider

Some better-ranked multi-line insurers include Horace Mann Educators HMN, Aegon AEG and CNO Financial Group CNO. While Horace Mann sports a Zacks Rank #1 (Strong Buy), Aegon and CNO Financial carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Horace Mann’s earnings surpassed estimates in each of the last four quarters, the average beat being 22.8%. In the past year, HMN has rallied 4%.

The Zacks Consensus Estimate for 2022 and 2023 earnings has moved 8.3% and 11% north, respectively, in the past 30 days.

Aegon’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 75%. In the past year, AEG has rallied 9.1%.

The Zacks Consensus Estimate for Aegon’s 2022 earnings has moved 12.5% north, respectively, in the past 60 days.

The bottom line of CNO Financial surpassed earnings estimates in each of the last four quarters, the average being 25.48%. In the past year, the insurer has lost 0.1%.

The Zacks Consensus Estimate for CNO Financial’s 2022 and 2023 earnings has moved 2.1% and 2.8% north, respectively, in the past 30 days.


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Aegon NV (AEG) : Free Stock Analysis Report

CNO Financial Group, Inc. (CNO) : Free Stock Analysis Report

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Horace Mann Educators Corporation (HMN) : Free Stock Analysis Report

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