Barclays on U.S. Insurance/Non-Life: ACE 2Q11 Better Than Expected, Guidance Raised; RNR & AJG Below Our Outlook
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Up: 8 | Down: 5 | New: 26
Rating Summary:
11 Buy, 3 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Barclays on U.S. Insurance/Non-Life: ACE 2Q11 Better Than Expected, Guidance Raised; RNR & AJG Below Our Outlook
Barclays analyst says, "Ace Ltd (NYSE: ACE) (OW-rated) has among the strongest global P&C franchises. ACE benefits from strong management and a solid balance sheet and could continue deploying excess capital in accretive acquisitions. We are raising our EPS estimate for ACE to $6.50 from $6.15 in 2011, and to $7.25 from $7.15 in 2012 (consensus=$7.41) to reflect better than anticipated 2Q11 results. ACE trades at an attractive valuation of 0.92x BV, 1.01x BV ex AOCI & 1.16x tangible BV."
"RenaissanceRe (NYSE: RNR) (EW-rated) has a strong franchise and is re-focused on its core property catastrophe reinsurance operations after exiting its subscale U.S. primary insurance business. Property reinsurance rates have increased, although RNR's loss reserve releases have slowed. We are lowering our 2011 EPS estimate for RNR to a loss of $1.75 from a loss of $1.05. No change to our 2012 EPS estimate for RNR of $7.00. RNR currently trades at a robust valuation of 1.25x BV."
"Reiterate EW rating on Arthur J Gallagher (NYSE: AJG). We expect AJG, similar to the other insurance brokers, to benefit from improving organic growth and positive operating leverage as the economy recovers, although the pace of improvement was below our outlook in 2Q11...Worse than anticipated earnings at AJG could signal a negative lateral for Aon (NYSE: AON), Willis (NYSE: WSH) & Marsh & McLennan (NYSE: MMC)."
Barclays analyst says, "Ace Ltd (NYSE: ACE) (OW-rated) has among the strongest global P&C franchises. ACE benefits from strong management and a solid balance sheet and could continue deploying excess capital in accretive acquisitions. We are raising our EPS estimate for ACE to $6.50 from $6.15 in 2011, and to $7.25 from $7.15 in 2012 (consensus=$7.41) to reflect better than anticipated 2Q11 results. ACE trades at an attractive valuation of 0.92x BV, 1.01x BV ex AOCI & 1.16x tangible BV."
"RenaissanceRe (NYSE: RNR) (EW-rated) has a strong franchise and is re-focused on its core property catastrophe reinsurance operations after exiting its subscale U.S. primary insurance business. Property reinsurance rates have increased, although RNR's loss reserve releases have slowed. We are lowering our 2011 EPS estimate for RNR to a loss of $1.75 from a loss of $1.05. No change to our 2012 EPS estimate for RNR of $7.00. RNR currently trades at a robust valuation of 1.25x BV."
"Reiterate EW rating on Arthur J Gallagher (NYSE: AJG). We expect AJG, similar to the other insurance brokers, to benefit from improving organic growth and positive operating leverage as the economy recovers, although the pace of improvement was below our outlook in 2Q11...Worse than anticipated earnings at AJG could signal a negative lateral for Aon (NYSE: AON), Willis (NYSE: WSH) & Marsh & McLennan (NYSE: MMC)."
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