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Zacks Value Trader Highlights: Arch Capital, CAN, Allstate, Progressive and Travelers

Zacks Equity Research

For Immediate Release

Chicago, IL – May 31, 2019 – Zacks Value Trader is a podcast hosted weekly by Zacks Stock Strategist Tracey Ryniec. Every week, Tracey will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here:

(https://www.zacks.com/stock/news/422457/should-you-hide-out-in-cheap-insurance-stocks)

Should You Hide Out in Cheap Insurance Stocks?

Welcome to Episode #143 of the Value Investor Podcast.

Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.

With the stock market showing volatility again, is there anywhere investors can hide?

Insurance has been around for hundreds of years. Lloyds of London was founded in 1688 in a coffee shop in London. Businesses and people have needed insurance in good times, and bad.

How Do You Find Insurance Stocks?

There are several types of insurance stocks including health, life insurance and brokerage.

But why not start with property and casualty?

That’s a Zacks industry under Insurance- property and casualty.

To find value stocks, Tracey added the forward P/E of 15 or less and a Zacks Rank of #1 (Strong Buy) or #2 (Buy), in order to get rising earnings estimates.

This screen produced 10 stocks.

But it was a narrow screen. Expanding it on Rank or on P/E will provide more names that investors may recognize.

5 Cheap Insurance Stocks

1.       Arch Capital Group ACGL is a specialty insurance and reinsurance company based in Bermuda. It’s cheap, with a forward P/E of 12.9. Earnings are expected to rise 19.5% in 2019 and another 8.3% in 2020. Shares have jumped 27% year-to-date.

2.       CNA Financial Corp. CNA is one of the largest commercial insurers in the US. It’s forward P/E is just 11 and shareholders are also rewarded with a dividend yielding 3%. But shares have only gained 1.9% on the year.

3.       Allstate ALL fell outside the screen as it’s a Zacks Rank #3 (Hold). But it is expected to have double digit earnings growth in both 2019 and 2020. It’s also cheap, with a forward P/E of 10.5. Shares are beating the S&P 500 in 2019, up 16% versus the S&P at 11%.

4.       Progressive PGR is one of the hottest property insurers. Over the last 5 years, shares have soared 143% versus just 40% for the S&P 500. It’s also the most expensive of these five stocks, with a forward P/E of 15.3.

5.       The Travelers TRV also fell outside the screen due to its Zacks Rank. But earnings are expected to be up 24% in 2019. Shares are trading at just 13x. It also pays a dividend, yielding 2.1%. It’s been hot year-to-date, though, gaining 20.5% which easily outpaced the S&P 500 for the same time period.

Many of the insurance stocks have rallied in 2019 but the value is still there.

Is it time to consider insurance stocks for your portfolio?

Find out all about the property insurers on this week’s podcast.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.