Argo Group International Holdings’ ARGO highly profitable business, growth efforts, expense initiative program, investment in technology and a solid capital position along with favorable growth make it a stock worth retaining in one’s portfolio.
Argo Group’s has a decent earnings surprise history. It surpassed estimates in three of the last four quarters and missed once.
Zacks Rank & Price Performance
Argo Group currently carries a Zacks Rank #3 (Hold). In a month, the stock has rallied 13.1%, outperforming the industry’s increase of 9.3%.
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Optimistic Growth Projections
The Zacks Consensus Estimate for 2023 earnings is pegged at $3.00, indicating an improvement of 215.8% from the year-ago reported figure.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2022 earnings has moved 11.8% north in the past 30 days, reflecting analyst optimism
Argo Group remains focused on being a pure-play U.S. specialty insurer with the sale of Lloyd's operation and pursues strategic actions to streamline its business model, strengthen its balance sheet and re-underwrite and drive efficiencies in its core businesses
Argo Group’s highly profitable businesses are well-poised for growth in attractive markets.
Argo Pro, Casualty, Construction, Environmental, Inland Marine and Surety contribute two-thirds of the U.S. premium base. ARGO continues to experience better pricing across its portfolio of businesses.
ARGO remains focused on improving underwriting profitability. Exiting reinsurance operations and non-core lines of business, lowering property exposure substantially, reducing volatility and increasing pricing will help ARGO achieve its target. Its re-underwriting actions are focused on its ongoing profitable business.
Argo Group consistently invests in technology in tandem with accelerated digitalization in the insurance industry. This, in turn, will improve operating efficiency and risk selection while reducing overall expenses.
ARGO boasts a solid balance sheet with modest financial leverage.
Stocks to Consider
Some better-ranked stocks from the property and casualty insurance industry are W.R. Berkley Corporation WRB, Root, Inc. ROOT and Kinsale Capital Group, Inc. KNSL. While W.R. Berkley sports a Zacks Rank #1 (Strong Buy), Root and Kinsale Capital carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The bottom line of W.R. Berkley surpassed estimates in each of the last four quarters, the average being 25.63%. Year to date, the insurer has gained 35%.
The Zacks Consensus Estimate for W.R. Berkley’s 2022 and 2023 earnings has moved 5.1% and 2.4% north, respectively, in the past 30 days.
Root delivered a trailing four-quarter average earnings surprise of 22.44%. Year to date, ROOT has lost 87.8%.
The Zacks Consensus Estimate for ROOT’s 2022 and 2023 earnings indicates a respective year-over-year increase of 44.8% and 23.8%.
Kinsale Capital’s earnings surpassed estimates in each of the last four quarters, the average being 15.16%. Year to date, Kinsale Capital has gained 30.4%.
The Zacks Consensus Estimate for KNSL’s 2022 and 2023 earnings implies a respective year-over-year rise of 27.5% and 21.9%.
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