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Assurant Lags Zacks Consensus – Analyst Blog

Zacks Market Commentaries — Fri, 05 Feb 2010 20:23:15 +0000

Assurant Inc. (AIZ) fourth quarter earnings of 86 cents per share lagged behind the Zacks Consensus Estimate of $1.01. Results also compared unfavorably with earnings of $1.30 in the year-ago quarter. Earnings were strained by restructuring charges of $12.3 million and a net operating loss of $29.7 million at Assurant Health.

With all of Assurant’s businesses experiencing modest downturns in the current recessionary environment, net earned premiums declined 4% year-over-year to $1.9 billion. Net investment income decreased to $172.5 million from $183.0 million in the fourth quarter of 2008.

Segment Results

Net operating income at Assurant Solutions improved considerably to $30.2 million from $11.9 million in the prior-year period due to favorable domestic service contract loss experience. Net earned premiums declined 4.0% year-over-year due to the impact of a previously disclosed accounting change affecting pre-need business sold in 2009, and the impact of foreign exchange.

Assurant Specialty Property reported a 10.0 year-over-year decline in net operating income to $106.9 million due to higher reinsurance costs and higher non-catastrophe loss experience. Net earned premiums declined 4.0% year-over-year due to declines in real estate owned premiums and increased reinsurance costs.

Assurant Health, whose outlook remains exposed to the continued reduction in small group premiums and less favorable individual medical loss experience, reported a 3.0% year-over-year decline in net earned premiums. Restructuring costs, increase in litigation reserve, and expenses related to H1N1 medical services caused an operating loss of $29.7 million, compared to an operating profit of $25.1 million in the year-ago quarter.

Lower premiums coupled with lower net investment income at Assurant Employee Benefits led to an18.0% decline in net operating income to $11.6 million. Economic pressures in the small business sector contributed a 4.0% decline in net premiums earned to $270.0 million.

For full year, net operating income came in at $464.9 million or $3.92 per share, compared to net operating income of $637.4 million or $5.36 per share, in 2008. The decline was primarily due to a net operating loss for Assurant Health coupled with reduced earnings at Assurant Employee Benefits and restructuring charges.

Net earned premiums in 2009 were $7.6 billion, down from $7.9 billion in 2008, contributed by a decline in all its business segments.

Book value per diluted share, excluding AOCI, increased 9.0% in 2009 to $40.47, from $37.16 as of Dec 31, 2008. The ratio of debt to total capital, excluding AOCI, improved to 17.0% versus 18.3% as of Dec 31, 2008.

To sum up, Assurant’s results clearly reflect the economic pressure on consumers and small businesses that is affecting its business. The company that had been consistently posting above 15% return on equity (ROE) reported a lower ROE of 10.1%.

To combat the challenging domestic economic environment, the company has taken cost control measures. With a low debt-to-capital ratio and resumption of the share repurchase program, we expect the company to deliver shareholder returns going forward.
Read the full analyst report on "AIZ"
Zacks Investment Research

Ratings Action on Assurant – Analyst Blog

Zacks Market Commentaries — Mon, 23 Nov 2009 22:16:15 +0000

Rating agency A.M. Best Co. has affirmed the financial strength ratings (FSR) and issuer credit ratings (ICR) of the property and casualty (P&C) and life and health insurance subsidiaries of Assurant Inc. (AIZ). Additionally, A.M. Best has affirmed the issuer credit ratings of "bbb" and debt ratings of Assurant.

Along with affirming the ratings of the parent, A.M. Best has also upgraded the FSR of four of its operating subsidiaries to "A" from "A-" and ICRs to "a" from "a-" with a stable outlook for all. The four subsidiaries are American Reliable Insurance Company, Voyager Indemnity Insurance Company, Reliable Lloyds Insurance Company and Caribbean American Property Insurance Company.

A.M. Best acknowledges Assurant’s diverse product and distribution platform, established presence in various niche markets, adequate risk-adjusted capitalization, solid operating earnings, adequate interest coverage ratio of over 10.0X and sufficient financial flexibility.

Negatives include an ongoing U.S. SEC investigation that has adversely affected the company’s credit profile. In July 2009, Standard and Poor’s lowered the counterparty credit ratings and financial strength ratings on two of Assurant’s domestic operating insurance subsidiaries to "A-" from "A."

Also, the company’s continued dependence on third-party reinsurance and significant growth in specialty property (both organically and through acquisitions) in conjunction with an increase in net retention associated with its property catastrophe (CAT) treaty in recent years, expose its results to a greater degree of variability over the near term.
Read the full analyst report on "AIZ"
Zacks Investment Research

Zacks Analyst Blog Highlights: Aetna Inc., UnitedHealth Group Inc., WellPoint Inc., Assurant Inc. and Cigna Corp. – Press Releases

Zacks Market Commentaries — Fri, 20 Nov 2009 12:51:53 +0000

For Immediate Release

Chicago, IL – November 20, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Aetna Inc. (AET), UnitedHealth Group Inc. (UNH), WellPoint Inc. (WLP), Assurant Inc. (AIZ) and Cigna Corp. (CI).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Thursday’s Analyst Blog:

Aetna Axes Jobs

The company expects to record after-tax restructuring charges of $40 million in fourth quarter 2009. Last December, the company cut 1,000 jobs, which was 3% of its total workforce. The company plans to slash majority of the jobs at its headquarters in Connecticut.

Aetna with a total head count of 35,500 is eliminating jobs to cope with the difficult economic environment and potential impact that the health care reform might cast on its health insurance business. Elimination of excess workforce will help streamline the business by optimizing staffing level, thereby maintaining efficiency.

During the third quarter of 2009, Aetna earned $326.2 million, or 73 cents per share. That represents an increase from $277.3 million, or 58 cents per share, in the same quarter last year. Membership has slumped throughout the health insurance sector as employers have cut jobs, reducing the number of people covered by employer-sponsored plans.

Aetna rivals UnitedHealth Group Inc. (UNH) and WellPoint Inc. (WLP) both recently saw enrollment declines in the third quarter. Last week, Assurant Health, a division of Assurant Inc. (AIZ) announced that it has slashed 94 jobs. Earlier during the year, peers Cigna Corp. (CI) cut 1,100 jobs and Wellpoint Inc. eliminated nearly 1,500 jobs.

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Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

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Aetna Axes Jobs – Analyst Blog

Zacks Market Commentaries — Thu, 19 Nov 2009 15:00:00 +0000

In a bid to become more efficient, the health insurer Aetna Inc. (AET) announced on Wednesday its intention to shed a total of 1,250 jobs or about 3.5% of its total workforce by the first quarter of 2010. Management intends to do so in two phases, by slashing 625 jobs now and the remaining early next year.

The company expects to record after-tax restructuring charges of $40 million in fourth quarter 2009. Last December, the company cut 1,000 jobs, which was 3% of its total workforce. The company plans to slash majority of the jobs at its headquarters in Connecticut .

Aetna with a total head count of 35,500 is eliminating jobs to cope with the difficult economic environment and potential impact that the health care reform might cast on its health insurance business. Elimination of excess workforce will help streamline the business by optimizing staffing level, thereby maintaining efficiency.

During the third quarter of 2009, Aetna earned $326.2 million, or 73 cents per share. That represents an increase from $277.3 million, or 58 cents per share, in the same quarter last year. Membership has slumped through out the health insurance sector as employers have cut jobs, reducing the number of people covered by employer-sponsored plans.

Aetna rivals UnitedHealth Group Inc. (UNH) and WellPoint Inc. (WLP) both recently saw enrollment declines in the third quarter. Last week, Assurant Health, a division of Assurant Inc. (AIZ) announced that it has slashed 94 jobs. Earlier during the year, peers Cigna Corp (CI) cut 1,100 jobs and Wellpoint Inc. eliminated nearly 1,500 jobs.
Read the full analyst report on "AET"
Read the full analyst report on "CI"
Read the full analyst report on "AIZ"
Read the full analyst report on "WLP"
Read the full analyst report on "UNH"
Zacks Investment Research

Top Flexible Balanced Funds – Mutual Fund Commentary

Zacks Market Commentaries — Fri, 18 Sep 2009 17:40:13 +0000

Today we are featuring top-performing "Flexible" balanced mutual funds, which can invest in stocks, bonds, or cash to any degree in search of income or total return.

Investors can find such funds by checking out the entire list of the Zacks #1 Rank Flexible Balanced Funds.

3 Great Picks

Principal SAM Flexible Income A (SAUPX) seeks to provide a high level of total return (consisting of reinvestment of income with some capital appreciation).

The fund operates as a fund of funds and invests principally in underlying funds. It may invest up to 40% of assets in any single fixed-income fund as well as cash equivalents.

Michael D. Meighan has managed the fund since March 2003. The fund has topped total returns of its benchmark index in the last 1-, 3-and 5-year periods.

First American Strategy Conservative Allocation A (FSFIX) was incepted September 2001. The investment seeks a high level of current income consistent with limited risk to capital.

The fund emphasizes bond funds with a small portion of stock funds. Its long-term target allocation is 30% stock funds and 70% bond funds.

This non-diversified fund makes short-term adjustments to take advantage of opportunities in the current market cycle. It has an expense ratio of 0.40%.

Greenspring (GRSPX) seeks long-term capital appreciation with income as a secondary objective. It invests in a blend of securities designed to mitigate volatility.

The fund may invest in companies of any market capitalization and also in firms that are in the process of financial restructurings or liquidations. It primarily focuses on undervalued stocks and special situation bonds that have the potential to provide both capital appreciation and income.

Shareholders have to make a minimum initial investment of $2,000 to enter this Zacks#1 Rank (?Strong Buy?) fund. Its key holdings include Michael Baker Corp. (BKR), Assurant Inc. (AIZ) and FTI Consulting Inc. (FCN).

Discover Many More Funds

Learn more about the new Zacks Mutual Fund Rank and discover some of the best market-beating mutual funds by browsing our new mutual funds section. This part of Zacks.com offers a variety of tools, including mutual fund research, a new mutual fund screener, helpful answers to frequently asked questions and quick access to prospectuses and other information.

By applying the Zacks Rank to mutual funds, investors can find funds that not only outpaced the market in the past but are also expected to outperform going forward.

Zacks Investment Research

Biggest Declines Among S&P – Analyst Blog

Dirk Van Dijk — Tue, 11 Aug 2009 21:11:49 +0000

The following is a list of the S&P 500 firms where the analysts have been cutting their expectations for the current fiscal year the most over the last month. Most likely these firms reported disappointing earnings or gave negative guidance on their conference calls.

Historically, you have not wanted to be invested in companies where the analysts who follow them most closely see the earnings prospects diminishing. Also, estimates in motion tend to remain in motion. The first bit of bad news is rarely the last (the cockroach theory). This means that the current expectations, even though down from last month, are probably still to high for these firms.

To weed out anomalies, only those firms that are currently expected to earn more than $0.50 in 2009 are included and only those firms where there are a minimum of three estimates in the system.

If you have these stocks in your portfolio, you might want to reconsider holding on to them.

Company	Ticker	2009 Zacks Consensus	4-Week % Change	Positive Revisions	Negative Revisions	EPS Growth	P/E
Harley-Davidson	HOG	$0.88	-38.80%	0	11	-68.29%	26.86
Peabody Energy	BTU	$1.44	-34.05%	1	9	-60.26%	24.71
Parker Hannifin	PH	$1.62	-32.28%	0	13	-48.32%	30.14
Cincinnati Finl	CINF	$1.17	-29.90%	0	4	-44.19%	21.01
Sunoco Inc	SUN	$1.56	-28.81%	0	7	-79.15%	16.76
Host Hotel&Rsrt	HST	$0.50	-26.61%	0	9	-71.07%	21.58
Pnc Finl Svc Cp	PNC	$2.03	-25.94%	0	12	-44.97%	21.84
Genzyme-General	GENZ	$2.19	-22.52%	1	5	-37.10%	22.02
Aetna Inc-New	AET	$2.92	-17.67%	1	15	-25.80%	9.32
Safeway Inc	SWY	$1.75	-16.43%	0	10	-20.72%	10.58
Manitowoc Inc	MTW	$0.52	-16.32%	1	6	-81.91%	13.2
Assurant Inc	AIZ	$4.07	-15.27%	0	11	-24.08%	6.71
Bb&T Corp	BBT	$1.14	-15.17%	7	16	-54.14%	22.61
Smith Intl	SII	$1.07	-14.73%	2	11	-71.82%	24.43
Qlogic Corp	QLGC	$0.59	-14.27%	0	10	-43.74%	23.09
Starwood Hotels	HOT	$0.67	-14.09%	1	15	-69.38%	44.26
Supervalu Inc	SVU	$2.01	-12.23%	0	6	-30.45%	7.63
Expeditors Intl	EXPD	$1.15	-11.06%	0	12	-16.00%	28.67
Consol Energy	CNX	$3.32	-10.98%	1	13	38.29%	11.49
Abercrombie	ANF	$0.90	-10.41%	1	16	-73.16%	36.38
Pitney Bowes In	PBI	$2.22	-10.38%	0	2	-20.26%	10.1
Bj Services	BJS	$0.70	-10.35%	0	12	-65.96%	20.29
Frontier Commun	FTR	$0.53	-9.49%	0	11	-8.37%	13.3
Lexmark Intl	LXK	$2.36	-9.44%	1	8	-33.63%	7.07
Marriott Intl-A	MAR	$0.83	-9.30%	2	14	-45.07%	30.59
Snap-On Inc	SNA	$2.70	-9.17%	0	3	-33.66%	14.31
Dover Corp	DOV	$1.80	-8.67%	0	8	-50.86%	19.05
Marathon Oil Cp	MRO	$2.06	-8.46%	2	8	-68.23%	14.91
Meredith Corp	MDP	$1.81	-8.42%	0	4	-11.03%	15.39
Symantec Corp	SYMC	$1.26	-8.25%	0	10	-13.32%	12.34
Utd Parcel Srvc	UPS	$2.16	-8.17%	0	16	-38.27%	25.04
Eqt Corp	EQT	$1.35	-8.17%	0	7	-32.39%	29.26

Zacks Investment Research

Zacks #5 Rank Additions for Monday – Zacks Tale of the Tape

Zacks Market Commentaries — Mon, 04 May 2009 12:35:49 +0000

Here are the stocks added to the Zacks #5 Rank ("strong sell") List today:

ABB Ltd (ABB)
American Ecology Corp (ECOL)
American Oil & Gas Inc (AEZ)
AmericanWest Bancorp (AWBC)
Assurant Inc (AIZ)
Blyth Inc (BTH)
China Sunergy Co Ltd (CSUN)
CoBiz Financial Inc (COBZ)
Coleman Cable Inc (CCIX)
Collective Brands Inc (PSS)
Courier Corp (CRRC)
Covance Inc (CVD)
Cumulus Media Inc (CMLS)
Doral Financial Corp (DRL)
Echostar Corp (SATS)
Electronics For Imaging Inc (EFII)
Genesco Inc (GCO)
The Greenbrier Companies (GBX)
Heritage Financial Corp (HFWA)
Heritage-Crystal Clean Inc (HCCI)
Itron Inc (ITRI)
LDK Solar Co Ltd (LDK)
Liberty Property Trust (LRY)
Macquarie Infrastructure Company LLC (MIC)
Massey Energy Co (MEE)
MDU Resources Group Inc (MDU)
Mercantile Bank Corp (MBWM)
Nash-Finch Co (NAFC)
NetScout Systems Inc (NTCT)
Old Point Financial Corp (OPOF)
Pacific Capital Bancorp (PCBC)
Parke Bancorp Inc (PKBK)
Parkway Properties Inc (PKY)
Penford Corp (PENX)
The PMI Group Inc (PMI)
Princeton National Bancorp Inc (PNBC)
ReneSola Ltd (SOL)
Republic Bancorp Inc KY (RBCAA)
Rockwood Holdings Inc (ROC)
RPM International Inc (RPM)
Simpson Manufacturing Co Inc (SSD)
Sociedad Quimica y Minera (SQM)
Staples Inc (SPLS)
Superior Industries International Inc (SUP)
TIB Financial Corp (TIBB)
TriCo Bancshares (TCBK)
Unisys Corp (UIS)
Vale (RIO)
Xinyuan Real Estate Co Ltd (XIN)

View the entire Zacks #5 Rank List.

Zacks Investment Research

Stocks Going Ex Dividend Late February

Fred Fuld — Mon, 02 Feb 2009 00:45:00 +0000

Investors occasionally use a stock trading technique called 'Buying Dividends,' which is the technique of buying stocks before the ex dividend date and selling the stock shortly after the ex date at about the same price, yet still being entitled to the dividend. This technique generally works only in bull markets.br /br /If you are interested in a href="http://stockerblog.blogspot.com/2008/05/buying-dividends-top-7-stocks-going-ex.html"buying dividends/a, there are many stocks in many different industries to choose from. In order to be entitled to the dividend, you have to buy the stock before the ex-dividend date, and you can't sell the stock until after the ex date. The actual dividend may not be paid for another few weeks. br /br /PACCAR Inc (PCAR) Ex-div date: 2/17/09 P/E ratio: 8 PEG Ratio: 0.69 Yield: 2.70% br /Moody's Corporation (MCO) Ex-div date: 2/18/09 P/E ratio: 11 PEG Ratio: 0.74 Yield: 1.90% br /Target Corporation (TGT) Ex-div date: 2/18/09 P/E ratio: 10 PEG Ratio: 0.81 Yield: 2.10% br /Main Street Capital Corporation (MAIN) Ex-div date: 2/18/09 P/E ratio: 12 PEG Ratio: 0.62 Yield: 14.90% extremely low cap, should be considered extremely speculativebr /Assurant, Inc. (AIZ) Ex-div date: 2/19/09 P/E ratio: 8 PEG Ratio: 0.77 Yield: 2.10% br /The McGraw-Hill Companies, Inc. (MHP) Ex-div date: 2/23/09 P/E ratio: 9 PEG Ratio: 0.66 Yield: 4.10% br /Crane Co. (CR) Ex-div date: 2/25/09 P/E ratio: 8 PEG Ratio: 0.83 Yield: 4.60% br /iGATE Corporation (IGTE) Ex-div date: 2/25/09 P/E ratio: 8 PEG Ratio: 0.45 Yield: 2.70% low cap, should be considered very speculativebr /Universal Health Services, Inc. (UHS) Ex-div date: 2/26/09 P/E ratio: 10 PEG Ratio: 0.95 Yield: 0.80% br /Tidewater Inc. (TDW) Ex-div date: 2/27/09 P/E ratio: 6 PEG Ratio: 0.48 Yield: 2.40% br /br /For more details on dividend definitions, check out a href="http://stockerblog.blogspot.com/2008/06/dividend-basics-and-whos-going-ex-in.html"definitions of dividend dates/a. If you like dividend stocks, you should check out the the High Yield Utility stocks and the Monthly Dividend Stocks at a href="http://WallStreetNewsNetwork.com"WallStreetNewsNetwork.com/a.br /br /emAuthor does not own any of the above at the time this article is written. /embr /br /By a href="http://Stockerblog.com"Stockerblog.com/adiv class="blogger-post-footer"div class='adsense' style='text-align:center; padding: 0px 3px 0.5em 3px;' script type="text/javascript"!-- google_ad_client="ca-pub-2427831169011625"; google_ad_width=300; google_ad_height=250; google_ad_format="300x250_as"; google_ad_type="text"; google_ad_channel ="8681602088"; google_color_border="FFF3DB"; google_color_bg="FFF3DB"; google_color_link="1B0431"; google_color_url="1B0431"; google_color_text="29303B"; //--/script script type="text/javascript" src="http://pagead2.googlesyndication.com/pagead/show_ads.js" /script /div

Assurant Target Bumped Down

Zacks Market Commentaries — Mon, 25 Aug 2008 12:06:55 +0000

Assurant Inc.'s (AIZ) core 2Q08 results were a nickel below our expectation. Based on diversified product and distribution platform and technology focus, AIZ has delivered solid operating earnings over the last five years.

However, continued dependence on third-party reinsurance and significant growth in specialty property exposes the group's earnings to a greater degree of variability over the near term. Therefore, we elect to keep our rating of the shares of this company as a Hold.

Following our review of AIZ's 2Q08 results we are decreasing our FY08 earnings expectation to $6.50 per share from $6.55 per share and our FY09 earnings expectation to $6.85 per share from $6.90 per share previously. The shares of Assurant currently trade at a multiple of 1.57x book value, excluding AOCI, of $36.68 per share for 2Q08 and 1.62x the $35.53 book value per share.

Based on general earnings trends, negligible catastrophe losses, we think the previously contracted price-to-book value of 1.60x should continue to be viewed more as a bottom range for this company. The company's price-to-book multiple is in-line with its peer group median level. We expect the company will eventually benefit from the overhangs in the sub-prime market with an offset in the price-to-book multiple to about in the coming quarters. For now however, we anticipate the company should trade close to 1.65x level, down from the close to priced-to-perfection level of 2.00x, recorded within the past year.

Therefore, we are decreasing our six-month target price to $63.40 per share from $70.60 per share, based on our book value expectation for $38.40 per share at December 31, 2008. At the current price level, this would imply a 10.9% total return potential over the next six-months.

Read the full analyst report on AIZ

"AIZ" Free Stock Analysis: Buy? Sell? Hold?
Zacks Investment Research