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A Hold recommendation has recently been issued to insurance company Everest Re Ltd. (RE) by Zacks service sector analyst Eric Rothmann. Here's what his latest update had to say:
'RE reported 3Q07 results of $3.68 per share, versus $3.68 per share in the year-ago quarter. Financial results came in well above our expectations, stemming from lower-than-anticipated incurred losses and loss adjustment expenses.
'Currently the shares of Everest Re trade at 1.20x its 3Q07 book value of $89.33 per share. RE's valuation has moderated from the 1.5x level exhibited a little over a year ago, as Everest's 5-year average ROE is currently below the peer group average. Prior to the conference call, we have adjusted our 2007 earnings expectation to $14.42 per share from $13.81 per share to reflect 2Q07 results, but maintained our 2008 earnings expectation at $12.80 per share.
'Our new six-month price target is $118.00 per share, up from $112.50 per share, which incorporates a slightly below peer multiple of 1.25x (driven by top-line growth concerns and the potential for additional catastrophe losses by the end of this year), to our estimated March 31, 2008 book value of $94.00 per share. While we are maintaining our Hold rating on the shares of Everest Re, we increased our 2007 earnings expectation to reflect 3Q07 results.'
Read the full analyst report on RE.
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