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Navigators Group Upped to Strong Buy

Zacks Equity Research

Zacks Investment Research upgraded Navigators Group Inc. (NAVG) to a Zacks Rank #1 (Strong Buy) on May 13, 2014.

Why the Upgrade?

Navigators Group has been witnessing a rise in earnings estimates on the back of strong first-quarter 2014 results and a significant growth momentum. The long-term expected earnings growth rate for this stock is 13.50%. Additionally, this property and casualty insurer had posted positive earning surprises in the trailing four quarters with an average beat of 49.06%.

Navigators Group reported its first-quarter results on May 7 with operating earnings of $1.45 per share, outpacing the Zacks Consensus Estimate of 97 cents by 49.48%. The results also exceeded the prior-year quarter figure of 75 cents per share.  

Results benefited from strong top-line growth, an increase in net investment income and higher premiums.

Net income grew substantially year over year, while gross written premiums and net written premiums rose 7.5% and 15.7%, respectively. The combined ratio improved to 92.2% from 97.9% in the year-ago quarter. On the flip side, a 5.5% rise in total expenses was recorded.

Based on Navigators Group’s fundamental strength, the Zacks Consensus Estimate for 2014 moved north by 7.0% to $4.16 per share over the last 30 days. Meanwhile, the estimate for 2015 rose 5.8% to $4.55 per share during the same period.

Other Stocks to Consider

Investors eyeing the property and casualty insurance industry may also consider other top-ranked players such as AmTrust Financial Services, Inc. (AFSI), Allied World Assurance Company Holdings, AG (AWH) and Aspen Insurance Holdings Ltd. (AHL). All these stocks sport the same Zacks Rank as Navigators Group.

Read the Full Research Report on AFSI
Read the Full Research Report on NAVG
Read the Full Research Report on AWH
Read the Full Research Report on AHL

Zacks Investment Research