AXIS Capital Holdings Limited AXS has been witnessing steady premium growth, courtesy of new business opportunities across the company’s business lines and a wide geographic footprint. Further, prudent acquisitions have been contributing to this rising momentum in the premiums and we expect the same to continue going forward on the back of the aforementioned catalysts.
AXIS Capital’s expansion plans with respect to AXIS Ventures, its third-party capital vehicle, are bearing fruits along with initiatives like re-entry into the U.S. primary casualty and weather and commodities business, thereby favoring the property and casualty insurer’s bottom line.
Notably, the consensus mark for current-year earnings per share is pegged at $5.13, representing a whopping year-over-year surge of 167.2%.
Further, the company is committed toward developing its Specialty Insurance, Reinsurance and Accident and Health lines of businesses that will ultimately drive long-term growth. Moreover, the P&C insurer is focused on expanding its portfolio mix and boosting the underwriting profitability by investing in accident and health business, renewable energy, cyber, agriculture reinsurance and mortgage reinsurance.
In order to accelerate its growth profile and enhance shareholder value, the company aims to capitalize on the opportunities by strategically using its resources. This, in turn, will enable the company to boost efficiencies and effectively serve clients and brokers across the world.
Given the improving interest rates and changes in the fair value of alternative investments, AXIS Capital has been displaying better investment results over a considerable period of time and we expect this trend to sustain in the near term.
AXIS Capital has a solid capital management policy in place with regular dividend hikes and share buybacks. The company made 13 consecutive dividend raises, banking on its sturdy earnings. Its dividend currently yields 2.8%, better than the industry average of 0.5%.
Also, it pulled off a positive surprise in three of the last four quarters, the average beat being 6.70%.
Zacks Rank and Share Price Movement
AXIS Capital carries a Zacks Rank #2 (Buy). Shares of the company have gained 7.2% year to date, outperforming the industry’s rise of 2.8%. We believe, the aforementioned upsides will push the stock up in the near term.
Other Stocks to Consider
Investors interested in other top-ranked stocks from the insurance industry can also consider Cincinnati Financial Corporation CINF, Hallmark Financial Services, Inc. HALL and Health Insurance Innovations, Inc. HIIQ, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Cincinnati Financial provides property and casualty insurance products in the United States. The company delivered positive surprises in three of the trailing four quarters, the average beat being 18.08%.
Hallmark Financial underwrites, markets, distributes and services property/casualty insurance products to businesses and individuals in the United States. The company surpassed estimates in all the preceding four quarters, the average being 91.28%.
Health Insurance Innovations operates as a cloud-based technology platform and distributor of individual plus family health insurance plans as well as supplemental products in the United States. The company exceeded estimates in all the previous four quarters, the average being 9.02%.
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