Employers Holdings Leveraging The Reopening And Expansion Of The Economy

Employment and job growth are looking pretty good for the time being, and while the workers’ compensation insurance market is quite competitive, operating conditions look basically favorable for Employers Holdings (NYSE:EIG) right now. Premiums have been growing nicely, and while I do have some concerns that loss frequency will increase, I think management is generally conservative with underwriting.

The shares haven’t done all that much since my last write-up, and comparisons to other large underwriters like Hartford (HIG) and W. R. Berkley (WRB) are of limited value given very different business mixes, and likewise with Amerisafe (AMSF), which is also a pure workers’ comp underwriter, but focuses on higher-risk groups. I do still see fair value in the mid-$40’s on the basis of both near-term ROE (P/BV) and long-term core earnings growth, but that makes this a relatively middling prospect today.

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Employers Holdings Leveraging The Reopening And Expansion Of The Economy