5. Berkshire Hathaway
Shares of Berkshire Hathaway ( BRK.B - Get Report) closed at $77.97 Monday, trading for 14.4 times the consensus 2013 earnings estimate of $5.43, among analysts polled by Thomson Reuters. The consensus 2014 EPS estimate is $5.83. Berkshire's Class B shares were up 4% year-to-date through Monday's close, after returning 11% during 2012. The consensus fourth-quarter earnings estimate for the Class B shares is $1.13, declining from $1.37 in the third quarter, but increasing from $1.08 in the fourth quarter of 2011. Unlike several other companies with a major property and casualty presence in the Northeast, Berkshire Hathaway has not announced a loss estimate from Hurricane Sandy. Of course, the company is involved in other businesses besides insurance, but insurance revenues made up 77% of total revenue during the first three quarters of 2012. During 2011, the company's pre-tax underwriting gain for its combined insurance businesses was $248 million. For the first three quarters of 2012, Berkshire's combined underwriting gain for its property and casualty insurance business was $354 million. BRK.B data by YCharts
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Shares of The Chubb Corp. ( CB - Get Report) closed at $77.97 Monday, trading for 12.5 times the consensus 2013 EPS estimate of $6.25. The consensus 2014 EPS estimate is $6.64. The shares returned 11% during 2012. Based on a quarterly payout of 41 cents, the shares have a dividend yield of 1.64%. Chubb plans to announce its fourth-quarter results on Jan. 31, after the market close. The company on Dec. 11 announced that it had estimated that its losses from Hurricane Sandy would be $880 million, or $570 million after taxes. The losses are expected to lower the company's earnings by $2.14 a share. When announcing the loss estimate, Chubb said it was suspending its share buyback program, but that it expected repurchases to resume, although it no longer expected "to complete repurchases under its current $1.2 billion authorization by the end of January 2013 as previously contemplated." The company also expects to announce an additional buyback program after it announces its fourth-quarter results. For the first three quarters of 2012, Chubb's underwriting income totaled $880 million. During 2011, underwriting income totaled $574 million. The consensus estimate for the fourth quarter is for the company to report a net loss of 45 cents a share, compared to EPS of $1.98 in the third quarter and $1.63 in the fourth quarter of 2011. CB data by YCharts
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Shares of The Travelers Companies ( TRV - Get Report) closed at $74.95 Monday, trading for 10.9 times the consensus 2013 EPS estimate of $6.85. The consensus 2014 EPS estimate is $7.06. The shares returned 25% during 2012. Based on a quarterly payout of 46 cents, the shares have a dividend yield of 2.45%. Travelers on Dec. 5 announced that its preliminary estimate of losses related to Sandy was $1.135 billion, net of reinsurance. The after-tax loss estimate was $650 million.. The company is scheduled announce its fourth-quarter results on Jan. 22, with a consensus earnings estimate of seven cents a share, compared to EPS of $2.22 during the third quarter, and $1.48 during the fourth quarter of 2011. The company on Dec. 5 also said it intended to resume repurchasing common shares, which it had suspended temporarily after Sandy hit. For the first three quarters of 2012, Travelers reported an underwriting profit of $845 million. For 2011, the company reported an underwriting loss of $745 million. TRV data by YCharts
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2. American International Group
Shares of American International Group ( AIG - Get Report) closed at $35.05 Monday, trading for 10 times the consensus 2013 EPS estimate of $3.51. The consensus 2014 EPS estimate is $3.95. Of course, the AIG story has been dominated by the aftermath of the massive bailout the company received in 2008 and 2009 -- a story that is now over, as the government in December completed its sale of common shares it held in the company. AIG's stock buybacks from the government during 2012 were a major factor in the 52% return for its stock. But the company also has multiple insurance businesses to run. The company on Dec. 7 announced that its preliminary estimate of losses from Sandy was $2.0 billion, net of reinsurance, or $1.3 billion, after tax. During the first three quarters of 2012, AIG reported an underwriting an underwriting loss of $838 million for its Property Casualty unit. During 2011, the underwriting loss for AIG's Chartis unit was $3.2 billion. The consensus fourth-quarter estimate is for AIG to report a loss of nine cents a share, compared to a profit of a dollar a share the previous quarter, and earnings of 82 cents a share in the fourth quarter of 2011. Wells Fargo analyst John Hall on Thursday downgraded AIG to a "Market Perform" rating from "Outperform," saying that "while we believe that AIG shares remain attractively priced, we are less optimistic about the emergence of near-term catalysts to push the shares higher in 2013." "Looking ahead, we see the opportunity associated with AIG shares linked to the company's capacity to improve its property-casualty results," Hall said. "These efforts include re-underwriting, re-pricing, re-tooling claims administration and reallocating capital to consumer lines. Over time, we expect AIG to be successful although we are not projecting a substantial P&C improvement over the next year." Hall estimates that AIG will 86 cents a share in 2013. AIG data by YCharts
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Shares of Allstate ( ALL - Get Report) closed at $42.93 Monday, trading for 9.5 times the consensus 2013 EPS estimate of $4.53. The consensus 2014 EPS estimate is $4.88. The shares returned 50% during 2012. Based on a quarterly payout of 22 cents, the shares have a dividend yield of 2.05%. Allstate announced on Nov. 28 estimated that its losses for October, net of reinsurance, totaled $1.1 billion before taxes. The company said that "autos represent approximately 40% of the total gross losses, with 78% in New York, 19% in New Jersey and 3% in other states." For its Property-Liability unit, Allstate reported underwriting income of $1.316 billion for the first three quarters of 2012. During 2011, the unit had an underwriting loss of $874 million. The company will announce its fourth-quarter results on Feb. 7, with analysts expecting a loss of seven cents a share, compared to a profit of $1.46 a share the previous quarter, and EPS of $1.48 during the fourth quarter of 2011. Allstate on Dec. 17 announced that its board of directors had "approved a share repurchase program of up to $1 billion to be funded by issuing a like amount of subordinated debentures," after its previous buyback program was completed. Following the company's announcement, Credit Suisse analyst Michael Zaremski reiterated his "Outperform" rating for Allstate, with a $42 price target, saying he expected the company's board of directors to approve an additional $1 billion worth of stock (equal to 5% of shares outstanding at today's stock price
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