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Citi Maintains a 'Buy' Rating on ACE Limited (ACE), Increases Price Target and Estimates

October 31, 2008 9:56 AM EDT
ACE Hot Sheet
Rating Summary:
    5 Buy, 2 Hold, 0 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 12 | Down: 6 | New: 15
Citi maintains a 'Buy' rating on ACE Limited (NYSE: ACE), increases price target from $50 to $68.

Citi analyst says, "While management remains cautious, we expect rates to improve starting in 2009, due to diminishing industry capital, increased loss trends, and higher cost of capital. We view ACE, well-capitalized and with a global platform, as well positioned to take market share from struggling AIG in U.S. E&S lines, D&O and internationally. The company prudently and aggressively grew underwriting operations in the previous hard market...We are increasing FY08E-FY10E EPS to $7.80, $7.20 and $7.85 in light of expectations for improved underwriting results...The (Price target) increase is due to a hardening market related higher price-to-book multiple and improved valuations following the recent P&C group rally."

ACE Limited its direct and indirect subsidiaries (collectively, the ACE Group of Companies) are a global property and casualty insurance and reinsurance organization.

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