I thought Everest Re (RE) looked a little too beaten down back in August,
largely on outsized worries about management’s ability to asses and
price risk, particularly given significant growth in reinsurance
underwriting. Since then, the shares have done a little better than most
of its peers including Arch Capital (ACGL) and AXIS (AXS), though hasn’t quite kept pace with RenRe (RNR) and the company’s trailing twelve-month performance looks a little better relative to the S&P 500 than it did before.
Four
months doesn’t really change all that much, but I do believe the
outlook for cat reinsurance pricing is a little better now, and I think
Everest Re has laid out a believable case for growth through targeting
opportunities in specialty/niche insurance and harder markets in the
reinsurance business. Reinsurance pricing is clearly a wildcard, as is
the demand for insurance-linked securities (where Everest has a
meaningful presence), and I think the company’s estimates for fourth
quarter cat losses could skew high, but the shares still look valued
attractively enough to consider buying and holding.
Continue here:
Everest Re Looking A Little Better, But Reinsurance Rates And Loss Trends Still Up For Debate
