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Assured Guaranty Ltd: A Strong Buy

Zacks Equity Research

On Mar 9, Zacks Investment Research upgraded Assured Guaranty Ltd. (AGO) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

With the fourth-quarter earnings beat, Assured Guaranty delivered three straight quarters of positive earnings surprise with an average of 16.3%.

Additionally, On Jan 18, 2013, the board of directors of Assured Guaranty approved a $200 million share repurchase program. Further, on Feb 7, the board also approved an 11% hike in its quarterly dividend.

Assured Guaranty reported its fourth-quarter results on Feb 27. Non-GAAP earnings per share came in at 94 cents, surpassing the Zacks Consensus Estimate by 32.4%.

Results benefited largely due to higher terminations of structured finance exposures as well as refunding of public finance exposures.

Top line improved 19.2% year over year to $447 million, driven by strong improvement in net premiums earned (up 32.1% year over year).

Expenses in the fourth quarter witnessed a sharp decline of 41% attributable to a 57% decline in loss and loss adjustment expense.

The Zacks Consensus Estimate for 2013 is $2.55 per share, down 9% year over year. For 2014, the Zacks Consensus Estimate is currently pegged at $2.64 per share, up 3.7% year over year.

Other Stocks to Consider

Multiline insurers such as CNO Financial Group (CNO) with a Zacks Rank #1 (Strong Buy) and Assurant Inc. (AIZ) and Cigna Corp. (CI) with a Zacks Rank #2 (Buy), among others, are worth noting.


Read the Full Research Report on AIZ

Read the Full Research Report on CI

Read the Full Research Report on CNO

Read the Full Research Report on AGO

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