(WRB) W.R. Berkley Corp.- Bear of the Day

We are downgrading our recommendation on W.R. Berkley Corp. (WRB) to Underperform from Neutral, reflecting slightly lower investment yield assumptions and modestly higher loss ratio forecasts which would eat into underwriting margins.

Berkley has been hurt by soft pricing conditions and increasing competition. The trend of loss claims shows a divergence from declining losses over the past several years. An increase in claim costs will offset the premium rate improvement seen lately, thus pressurizing underwriting margins.

Our six-month target price of $27.00 per share equates to about 10.6x our earnings estimate for 2011. Combined with the $0.32 per share annual dividend, this target price implies an expected negative return of 8.2% over that period.

BERKLEY (WR) CP (WRB): Free Stock Analysis Report

Zacks Investment Research

About vitalstocks

This is a sample profile field. Vitalstocks is the operating company for Stockbloghub. This will place the picture of the author or company in the profile. Here is another extra line of information.


Powered by Facebook Comments

Similar Posts: | | | | Financial | Property & Casualty Insurance

RSS feeds: W.R. Berkley Corporation | Westar Energy Inc. | WR | WRB | Financial | Property & Casualty Insurance |

Other Posts by | RSS Feed for this author