Stock price when the opinion was issued
RE's symbol has changed to EG, Everest Group. Market cap $14B, P/E 7.5X, yield 2.32%. An insurance company, it has shown decent historical growth, and consensus calls for very good growth this year and next. Recent premium growth in reinsurance was lower than expected, but not really to worrying proportions. Aviation losses are higher than average, but these should stabilize. The dividend has grown 6% over five years. We think EG is fine, if not exciting. It is priced well, and the stock is up 85% over ten years. We would be OK owning a small position as part of a US financial allocation.
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EG is a Bermuda based reinsurance company who recently reported earnings of $678 million, 20% ROE and 23% growth in premiums written. January is a big month in renewals and the company believes they are well positioned. It trades at 7x earnings and 1.4x book. We recommend placing a stop-loss at $315, looking to achieve $447 -- upside potential of 22%. Yield 1.8%
(Analysts’ price target is $447.62)