Reinsurance Group (RGA), Velocity Partner to Boost Investment
Reinsurance Group of America, Incorporated RGA through its wholly-owned subsidiary made a strategic minority investment into the holding company of Velocity Capital Advisors LLC. The insurer also agreed over long-term investment management on behalf of its subsidiaries.
NY-based Velocity provides financing solutions across multiple investment strategies, including concentrated Net Asset Value (NAV), management company and continuation fund financings. It aids investors with a full suite of liquidity solutions.
Velocity provides capital collateralized by the underlying assets of a wide range of private funds and sectors, including hedge funds, private equity funds, growth capital and real estate. Velocity has assets under management of $1.5 billion.
This strategic partnership with Velocity is likely to provide RGA with a medium to get better access to private assets.
Management noted the partnership to be in sync with RGA’s strategy to expand its investment platform. Going forward, the insurer intends to continue assessing the investments in alternative asset managers.
Reinsurance Group is among the leading global providers of life reinsurance and financial solutions, with $3.5 trillion of life reinsurance in force and assets worth $92.2 billion as of Dec 31, 2021. RGA remains well-poised to benefit from the expanding business along with disciplined capital management. RGA’s high-quality investment portfolio is well-positioned as it remains diversified across asset classes, sectors, issuers and geography.
This leading global life and health reinsurer has a strong presence in the United States and the Latin American traditional markets. The life insurer is focused on expanding its investments in the new and emerging markets besides generating new business premiums. The insurer expands its product line with market-leading services, capabilities, expertise and innovation. Product line expansion contributes to risk diversification. Higher income earned on invested assets also contributes to top-line growth of the insurer.
As far as Velocity is concerned, this transaction is expected to bolster its market position with a diversified value proposition and provide customized capital solutions to meet the liquidity needs of the alternative asset secondary market.
Price Performance
Shares of this currently Zacks Rank #5 (Strong Sell) insurer have outperformed the industry in the year-to-date period. RGA has gained 0.2% against the industry’s decrease of 1.4%.
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You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stocks to Consider
Some better-ranked insurers are United Fire Group, Inc. UFCS, Kinsale Capital Group, Inc. KNSL and Cincinnati Financial Corporation CINF. United Fire and Kinsale Capital currently sport a Zacks Rank #1, whereas Cincinnati Financial carries a Zacks Rank #2 (Buy).
United Fire’s earnings surpassed estimates in each of the last four quarters, the average being 275.45%. In the past year, the UFCS stock has declined 15.6%.
The Zacks Consensus Estimate for UFCS’ 2022 and 2023 earnings has moved 122.2% and 76.9% north, respectively, in the past 60 days.
Kinsale Capital’s earnings surpassed estimates in each of the last four quarters, the average being 32.04%. In the past year, Kinsale Capital has rallied 37.7%.
The Zacks Consensus Estimate for KNSL’s 2022 and 2023 earnings has moved 3.8% and 3.5% north, respectively, in the past 30 days.
The bottom line of Cincinnati Financial surpassed earnings estimates in each of the last four quarters, the average being 38.48%. In the past year, the insurer has rallied 27.5%.
The Zacks Consensus Estimate for Cincinnati Financial’s 2022 and 2023 earnings has moved 5.7% and 5.5% north, respectively, in the past 60 days.
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Cincinnati Financial Corporation (CINF) : Free Stock Analysis Report
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