Zacks Investment Research Downgrades Alleghany (Y) to Strong Sell

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Zacks Investment Research downgraded shares of Alleghany (NYSE:Y) from a hold rating to a strong sell rating in a report issued on Tuesday, Zacks.com reports.

According to Zacks, “Shares of Alleghany have underperformed the industry year to date. Exposure to cat loss induces volatility in underwriting results while rising expenses weigh on the margin expansion. The company witnessed estimates for 2019 move south in the last 60 days. A Zacks Rank #5 and Earnings ESP of 0.00% makes surprise prediction difficult as it reports frost quarter results on May 7. The Zacks Consensus estimate for first quarter is pegged at $7.29, down 35.1% year over year. Nonetheless, Alleghany’s strong performance across insurance and reinsurance operations will continue to boost its premium revenues. It strives to grow via both acquisitions and organic means as these not only diversify and strengthen its portfolio but also expand its global footprint. A solid balance sheet supports the company’s shareholder-friendly moves and its growth initiatives. It continues to expect compound book value per share growth of 7-10% over a long term.”

A number of other research analysts have also recently commented on the company. Canaccord Genuity raised Alleghany to a buy rating in a report on Wednesday, February 13th. JMP Securities lifted their price objective on Alleghany from $675.00 to $690.00 and gave the stock a market outperform rating in a research note on Thursday, February 21st. Finally, ValuEngine downgraded Alleghany from a buy rating to a hold rating in a research note on Saturday, February 23rd.

NYSE Y opened at $651.74 on Tuesday. The company has a debt-to-equity ratio of 0.22, a quick ratio of 0.33 and a current ratio of 0.33. Alleghany has a 12 month low of $558.50 and a 12 month high of $666.00. The company has a market capitalization of $9.35 billion, a P/E ratio of 40.41 and a beta of 0.75.

Alleghany (NYSE:Y) last posted its quarterly earnings results on Wednesday, February 20th. The insurance provider reported ($4.35) EPS for the quarter, topping the Zacks’ consensus estimate of ($5.31) by $0.96. Alleghany had a return on equity of 2.94% and a net margin of 0.57%. The company had revenue of $1.23 billion for the quarter. Alleghany’s revenue was down 26.6% on a year-over-year basis. As a group, equities analysts forecast that Alleghany will post 36 earnings per share for the current year.

In other Alleghany news, Director William K. Lavin sold 518 shares of Alleghany stock in a transaction that occurred on Monday, April 8th. The stock was sold at an average price of $615.56, for a total value of $318,860.08. Following the sale, the director now owns 2,675 shares of the company’s stock, valued at approximately $1,646,623. The transaction was disclosed in a filing with the SEC, which is accessible through this hyperlink. Also, Director Phillip M. Martineau sold 230 shares of Alleghany stock in a transaction that occurred on Friday, March 29th. The stock was sold at an average price of $613.47, for a total value of $141,098.10. Following the completion of the sale, the director now directly owns 3,549 shares in the company, valued at approximately $2,177,205.03. The disclosure for this sale can be found here. Insiders own 3.44% of the company’s stock.

Large investors have recently added to or reduced their stakes in the business. Pennsylvania Trust Co bought a new position in shares of Alleghany during the 1st quarter valued at approximately $8,561,000. Federated Investors Inc. PA increased its position in shares of Alleghany by 1,068.8% during the 3rd quarter. Federated Investors Inc. PA now owns 69,298 shares of the insurance provider’s stock valued at $45,219,000 after purchasing an additional 63,369 shares during the last quarter. Pensionfund Sabic bought a new position in shares of Alleghany during the 4th quarter valued at approximately $1,558,000. Mraz Amerine & Associates Inc. increased its position in shares of Alleghany by 0.6% during the 4th quarter. Mraz Amerine & Associates Inc. now owns 38,381 shares of the insurance provider’s stock valued at $23,924,000 after purchasing an additional 229 shares during the last quarter. Finally, Xact Kapitalforvaltning AB increased its position in shares of Alleghany by 27.0% during the 4th quarter. Xact Kapitalforvaltning AB now owns 1,881 shares of the insurance provider’s stock valued at $1,172,000 after purchasing an additional 400 shares during the last quarter. 82.81% of the stock is currently owned by institutional investors and hedge funds.

About Alleghany

Alleghany Corporation provides property and casualty reinsurance and insurance products in the United States and internationally. The company operates in three segments: Reinsurance, Insurance, and Alleghany Capital. The Reinsurance segment offers fire, allied lines, auto physical damage, and homeowners multiple peril reinsurance products; and casualty and other reinsurance products, such as medical malpractice, ocean marine and aviation, accident and health, mortgage, surety, and credit reinsurance products, as well as directors' and officers', errors and omissions, general, and auto liability reinsurance.

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