Why Old Republic (ORI) Shares Are Attracting Investors Now
Old Republic International Corporation ORI has been in investors’ good books due to its solid market presence, niche focus, low property catastrophe exposure in its General Insurance segment and strong capital position.
Optimistic Growth Projections
The Zacks Consensus Estimate for ORI’s 2024 revenues is pegged at $7.70 billion, indicating a 3.1% increase from the year-ago reported figure.
Earnings Surprise History
Old Republic International has a solid record of beating earnings estimates in each of the last four quarters, the average being 28.59%.
Zacks Rank & Price Performance
Old Republic International currently carries a Zacks Rank #2 (Buy). In the past year, the stock has gained 24%, outperforming the industry’s growth of 3.7%.
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Style Score
Old Republic International has a VGM Score of B. VGM Score helps identify stocks with the most attractive value, best growth and the most promising momentum.
Back-tested results have shown that stocks with a VGM Score of A or B combined with a Zacks Rank #1 (Strong Buy) or #2 offer better returns.
Attractive Valuation
ORI shares are trading at a price-to-book multiple of 1.39, lower than the industry average of 2.62.
The company has a Value Score of A. This style score helps find the most attractive value stocks.
Business Tailwinds
ORI’s General Insurance segment should continue to benefit from segmentation, better risk selection, meticulous pricing and increased use of analytics. These have helped it deliver a combined ratio below 96 for 14 years. ORI aims for a combined ratio between 90 and 95.
The Title business should continue to benefit from an expanding presence in the commercial real estate market.
This third-largest title insurer in the country has been strengthening its balance sheet by improving its cash balance and lowering the leverage ratio.
ORI has an impressive dividend history banking on operational excellence. It increased dividends for 42 straight years. It has been paying out dividends for the past 82 years, beside paying out special dividends occasionally. Its dividend yield of 3.3% betters the industry average of 2.6%, making it an attractive pick for yield-seeking investors.
Notably, Old Republic International is one of the 111 companies that have posted at least 27 consecutive years of annual dividend growth.
Other Stocks to Consider
Some other top-ranked stocks from the multi-line insurance industry are Assurant, Inc. AIZ, Everest Group, Ltd. EG and Goosehead Insurance GSHD, each sporting a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Assurant’s earnings surpassed estimates in each of the last four quarters, delivering an average surprise of 42.38%.
The Zacks Consensus Estimate for AIZ’s 2023 and 2024 earnings implies 30.8% and 3.6% growth, respectively, year over year. In the past year, the insurer has gained 34.9%.
Everest Group’s earnings surpassed estimates in three of the last four quarters and missed in one, delivering an average surprise of 24.50%.
The Zacks Consensus Estimate for EG’s 2023 and 2024 earnings implies 105.32% and 10.98% year-over-year growth, respectively. In the past year, the insurer has gained 19.3%.
Goosehead Insurance’s earnings surpassed estimates in three of the last four quarters and missed in one, delivering an average surprise of 100.43%.
The Zacks Consensus Estimate for GSHD’s 2023 and 2024 earnings implies 150.9% and 28.2% growth, respectively, on a year-over-year basis. In the past year, the insurer has gained 82.4%.
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Assurant, Inc. (AIZ) : Free Stock Analysis Report
Old Republic International Corporation (ORI) : Free Stock Analysis Report
Goosehead Insurance (GSHD) : Free Stock Analysis Report
Everest Group, Ltd. (EG) : Free Stock Analysis Report
