The marketing services and media company reported last week fourth-quarter earnings of $42.8 million, or 95 cents a share, up from year-ago earnings of $24.8 million, or 47 cents."While impressed with Q4's shared mail growth, seasonal contributions will likely not be repeated leaving potential for continued lumpy y/y trends ahead," Piper Jaffray analysts wrote in a report Tuesday. "We have increased confidence Valassis can hit its 3%+ shared mail growth target in FY12, but q/q volatility will not find support in other business segments facing unique challenges, which leaves a stock not for the faint of heart." Shares of Valassis Communications were upgraded to buy from hold by TheStreet Ratings. Valassis Communications has a forward P/E of 7.16; the average for media agencies is 24.43. For comparison, comScore (SCOR) and ValueClick (VCLK) both have higher forward P/Es of 16.14 and 10.7, respectively. Of the 11 analysts who cover Valassis, eight rated the stock a buy and three gave it a hold rating. TheStreet Ratings gives Valassis Communications a B grade with a $30.39 price target. The stock closed Friday at $25.58 and has risen 33.02% year to date.
Montepelier Re Holdings The insurance and reinsurance company reported earlier this month fourth-quarter earnings of $28.5 million, or 40 cents a share, down from year-ago earnings of $41.8 million, or 63 cents. "The company has taken steps in recent months (sale of MUSIC, Torus deal) to free up capital and position itself to be able to write more property business," Sterne Agee analysts wrote in a Feb. 10 report. "However, while pricing has increased in property catastrophe lines, management has held back on deploying capacity to position for potentially better rate going forward. The company in our view continues to have flexibility for further repurchase going forward with year-end equity of $1.55 billion about $50 mm higher than the company's stated goal of maintaining at least $1.5 billion of capital." Shares of Montepelier Re Holdings was upgraded to buy from hold by TheStreet Ratings. "The company's strengths can be seen in multiple areas, such as its revenue growth and largely solid financial position with reasonable debt levels by most measures," TheStreet Ratings wrote. "We feel these strengths outweigh the fact that the company has had sub par growth in net income." Montepelier Re Holdings has a forward P/E of 8.39; the average for reinsurance companies is 8.41. For comparison, Everest Re Group (RE) has a lower forward P/E of 7.25; Alterra Capital Holdings' (ALTE) forward P/E is 9.94. All five of the analysts who cover Montepelier Re Holdings rated it a hold. TheStreet Ratings gives Montepelier Re Holdings a B grade and $21.18 price target. The stock closed Friday at $18.45 and has risen 3.94% year to date.
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