NEW YORK (
) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 7.0%. Since the same quarter one year prior, revenues rose by 21.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Y's debt-to-equity ratio is very low at 0.10 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- The net income growth from the same quarter one year ago has significantly exceeded that of the Insurance industry average, but is less than that of the S&P 500. The net income increased by 0.6% when compared to the same quarter one year prior, going from $37.43 million to $37.67 million.
- ALLEGHANY CORP has improved earnings per share by 5.1% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, ALLEGHANY CORP reported lower earnings of $16.06 versus $21.74 in the prior year. For the next year, the market is expecting a contraction of 41.8% in earnings ($9.35 versus $16.06).
Alleghany Corporation, through its subsidiaries, engages in the property and casualty, and surety insurance business in the United States. The company has a P/E ratio of 18.8, above the average insurance industry P/E ratio of 18.1 and above the S&P 500 P/E ratio of 17.7. Alleghany Corp DEL has a market cap of $2.46 billion and is part of the
industry. Shares are up 6% year to date as of the close of trading on Friday.
You can view the full
or get investment ideas from our
-- Written by a member of TheStreet RatingsStaff