Stock of the Day

June 22, 2022

W. R. Berkley (WRB)

$61.01
+$0.61 (+1.0%)
Market Cap: $23.02B

About W. R. Berkley

W. R. Berkley Corporation, an insurance holding company, operates as a commercial lines writers worldwide. It operates in two segments, Insurance and Reinsurance & Monoline Excess. The Insurance segment underwrites commercial insurance business, including excess and surplus lines, admitted lines, and specialty personal lines. This segment also provides accident and health insurance and reinsurance products; insurance for commercial risks; casualty and specialty environmental products; specialized insurance coverages for fine arts and jewelry exposures; excess liability and inland marine coverage for small to medium-sized insureds; and commercial general liability, umbrella, professional liability, directors and officers, commercial property, and surety products, as well as products for technology, and life sciences and travel industries. In addition, this segment offers cyber risk solutions; crime and fidelity insurance products; medical professional coverages; workers' compensation insurance products; general insurance; personal lines insurance solutions, including home, condo/co-op, auto, and collectibles; automobile, law enforcement, public officials and educator's legal, and employment practices liability, as well as incidental medical and property and crime insurance products; at-risk and alternative risk insurance program management services; professional liability; energy and marine risks; and provides insurance products to the Lloyd's marketplace. The Reinsurance & Monoline Excess segment provides treaty and facultative reinsurance solutions; property and casualty reinsurance; facultative reinsurance products include automatic, semi-automatic and individual risk assumed reinsurance; and turnkey products such as cyber, employment practices liability insurance, liquor liability insurance and violent events. The company was founded in 1967 and is headquartered in Greenwich, Connecticut.

W. R. Berkley Bull Case

Here are some ways that investors could benefit from investing in W. R. Berkley Co.:

  • The stock is currently trading at $60.79, which is near its 52-week high of $65.49, indicating strong market performance and potential for further appreciation.
  • W. R. Berkley Co. reported earnings per share of $1.13 for the latest quarter, surpassing the consensus estimate of $0.95, showcasing strong financial performance and effective management.
  • The company has a solid return on equity of 20.83%, which suggests efficient use of shareholders' equity to generate profits, making it an attractive investment.
  • W. R. Berkley Co. has a low payout ratio of 7.34%, indicating that it retains a significant portion of its earnings for growth, which could lead to increased future dividends and capital appreciation.
  • Analysts have a consensus rating of "Hold" with an average price target of $64.36, suggesting that there is potential for the stock to reach this target, providing a favorable outlook for investors.

W. R. Berkley Bear Case

Investors should be bearish about investing in W. R. Berkley Co. for these reasons:

  • Despite recent upgrades, one analyst has issued a sell rating, indicating some skepticism about the stock's future performance.
  • The stock has a beta of 0.67, suggesting lower volatility compared to the market, which may limit potential gains during bullish market conditions.
  • The current ratio and quick ratio are both at 0.36, indicating potential liquidity issues, which could affect the company's ability to meet short-term obligations.
  • W. R. Berkley Co. operates in a competitive insurance market, which may pressure margins and limit growth opportunities in the future.
  • The stock's price-to-earnings ratio of 13.93, while reasonable, may not be attractive compared to other growth stocks, potentially leading investors to seek better opportunities elsewhere.

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