FBR Capital Reiterates an 'Outperform' on ACE Ltd (ACE); 1Q11: Respectable Quarter Despite Heavy Catastrophe Activity
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Price: $111.02 +0.87%
Rating Summary:
11 Buy, 3 Hold, 0 Sell
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Today's Overall Ratings:
Up: 11 | Down: 18 | New: 20
Rating Summary:
11 Buy, 3 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 20
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FBR Capital reiterates an 'Outperform' on ACE Ltd (NYSE: ACE), PT $83.
FBR analyst says, "On May 4, 2011, ACE reported 1Q11 operating EPS of $0.79 and 4.6% annualized ROE in the quarter, results that we consider somewhat impressive in light of the heavy catastrophe activity over the past several months. The diversification in sources of premiums and the robust risk management at ACE have led to catastrophe losses of only $443M, representing less than 2% of $23.4B in equity. As such, ACE was able to print positive EPS and grow BV by 1.1% in one of the heaviest catastrophe quarters in recent memory. We believe that ACE has one of the most redundant reserves among insurers we cover. The paid-to-incurred ratios for the 2003–2007 accident years are significantly below those of competitors and ACE's own historical paid patterns, implying significant redundancies."
"We are tweaking our 2011 operating EPS estimate to $5.70 from $5.85 and our 2012 forecast to $6.90 from $7.00. Our price target is based on a 1.1x multiple to 1Q12E book value."
For more ratings news on ACE Ltd click here and for the rating history of ACE Ltd click here.
Shares of ACE Ltd closed at $66.47 yesterday.
FBR analyst says, "On May 4, 2011, ACE reported 1Q11 operating EPS of $0.79 and 4.6% annualized ROE in the quarter, results that we consider somewhat impressive in light of the heavy catastrophe activity over the past several months. The diversification in sources of premiums and the robust risk management at ACE have led to catastrophe losses of only $443M, representing less than 2% of $23.4B in equity. As such, ACE was able to print positive EPS and grow BV by 1.1% in one of the heaviest catastrophe quarters in recent memory. We believe that ACE has one of the most redundant reserves among insurers we cover. The paid-to-incurred ratios for the 2003–2007 accident years are significantly below those of competitors and ACE's own historical paid patterns, implying significant redundancies."
"We are tweaking our 2011 operating EPS estimate to $5.70 from $5.85 and our 2012 forecast to $6.90 from $7.00. Our price target is based on a 1.1x multiple to 1Q12E book value."
For more ratings news on ACE Ltd click here and for the rating history of ACE Ltd click here.
Shares of ACE Ltd closed at $66.47 yesterday.
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