Arch Capital Rallies 35% YTD: How Should You Play the Stock?

Zacks11-27

Shares of Arch Capital Group Ltd. ACGL have rallied 34.7% year to date, compared with the industry’s increase of 33.8%, the Finance sector’s rise of 24% and the Zacks S&P 500 composite’s rise of 25.7%...

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ACGL have rallied 34.7% year to date, compared with the industry’s increase of 33.8%, the Finance sector’s rise of 24% and the Zacks S&P 500 composite’s rise of 25.7%...</p>\n\n<a href=\"https://finance.yahoo.com/news/arch-capital-rallies-35-ytd-171100567.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Arch Capital Rallies 35% YTD: How Should You Play the Stock?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nArch Capital Rallies 35% YTD: How Should You Play the Stock?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-11-27 01:11 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/arch-capital-rallies-35-ytd-171100567.html><strong>Zacks</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Shares of Arch Capital Group Ltd. ACGL have rallied 34.7% year to date, compared with the industry’s increase of 33.8%, the Finance sector’s rise of 24% and the Zacks S&P 500 composite’s rise of 25.7%...</p>\n\n<a href=\"https://finance.yahoo.com/news/arch-capital-rallies-35-ytd-171100567.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"LU0170899867.USD","symbol_name":"EASTSPRING INVESTMENTS WORLD VALUE EQUITY  \"A\" (USD) ACC","start_time":0,"source_url":"https://finance.yahoo.com/news/arch-capital-rallies-35-ytd-171100567.html","article_id":"2486838644","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/EEUv5JQFTAI4U5iqIocwgw--~B/aD00MDA7dz02MzU7YXBwaWQ9eXRhY2h5b24-/https://media.zenfs.com/en/zacks.com/9d8e6ae4a2f2f78756262fb38b308001"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2486838644","pubTimestamp":1732641060,"columns":[],"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Shares of Arch Capital Group Ltd. ACGL have rallied 34.7% year to date, compared with the industry’s increase of 33.8%, the Finance sector’s rise of 24% and the Zacks S&P 500 composite’s rise of 25.7%. With a market capitalization of $37.6 billion, the average volume of shares traded in the last three months was 1.9 million.New business opportunities, rate improvement, growth in existing accounts and a solid capital position are driving this leading specialty P&C and mortgage insurer.ACGL shares are trading well above the 50-day moving average, indicating a bullish trend.Two of the eight analysts covering the stock lowered estimates for the current year, while one lowered the same for the next year. The Zacks Consensus Estimate for Arch Capital’s 2024 and 2025 earnings has moved 1.4% and 24% south, respectively, in the past 30 days, reflecting analysts’ pessimism.The Zacks Consensus Estimate for 2024 earnings is pegged at $8.99 per share, suggesting an increase of 6.4% on 20.9% higher ","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU0170899867.USD":"EASTSPRING INVESTMENTS WORLD VALUE EQUITY  \"A\" (USD) ACC","ROIC":"Retail Opportunity Investments C","LU1169590202.USD":"ALLSPRING (LUX)  U.S. SELECT EQUITY \"I\" (USD) ACC","BK4585":"ETF&股票定投概念","LU1169589451.USD":"ALLSPRING (LUX)  U.S. SELECT EQUITY \"A\" (USD) ACC","ACGLO":"Arch Capital Group Ltd.-Depositary Shares 1/1,000th 5.45%","BK4107":"财产与意外伤害保险","ACGL":"艾奇资本","BK4588":"碎股","WRB":"WR柏克利","ACGLN":"Arch Capital Group Ltd.","LU0971096721.USD":"富达环球金融服务 A","CNA":"CAN金融","LU1363072403.SGD":"Fidelity Global Financial Services A-ACC-SGD","FNF":"富达国民金融","BK4080":"零售业房地产投资信托","BK4231":"零售房地产信托"},"translate_title":"Arch Capital年初至今上涨35%：你应该如何玩这只股票？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"CNA":1,"WRB":1,"ROIC":1,"FNF":1,"ACGL":1,"ACGLO":0.9,"ACGLN":0.9},"content_text":"Shares of Arch Capital Group Ltd. ACGL have rallied 34.7% year to date, compared with the industry’s increase of 33.8%, the Finance sector’s rise of 24% and the Zacks S&P 500 composite’s rise of 25.7%. With a market capitalization of $37.6 billion, the average volume of shares traded in the last three months was 1.9 million.New business opportunities, rate improvement, growth in existing accounts and a solid capital position are driving this leading specialty P&C and mortgage insurer. \nACGL vs Industry, Sector & S&P 500 YTD\nImage Source: Zacks Investment Research\nACGL shares are trading well above the 50-day moving average, indicating a bullish trend.\nAverage Target Price for ACGL Suggests an Upside\nBased on short-term price targets offered by 17 analysts, the Zacks average price target is $119 per share. The average suggests a potential 19.4% upside from Monday’s closing price.\nImage Source: Zacks Investment Research\nSouthbound Estimate Revision\nTwo of the eight analysts covering the stock lowered estimates for the current year, while one lowered the same for the next year. The Zacks Consensus Estimate for Arch Capital’s 2024 and 2025 earnings has moved 1.4% and 24% south, respectively, in the past 30 days, reflecting analysts’ pessimism. \nFavorable Return on Capital\nReturn on equity in the trailing 12 months was 18.9%, better than the industry average of 7.6%. This highlights the company’s efficiency in utilizing shareholders’ funds. Also, the return on invested capital (ROIC) has been increasing over the last few quarters as the company raised its capital investment over the same time frame. This reflects ACGL’s efficiency in utilizing funds to generate income. ROIC in the trailing 12 months was 14.7%, better than the industry average of 5.8%.\nFactors Favoring ACGL\nWidespread operations coupled with a compelling product portfolio provide meaningful diversification and earnings stability to ACGL. These also enable international expansion, enhance operations and diversify business at attractive risk-adjusted returns through strategic buyouts. Its Mortgage Insurance complements the specialty insurance and reinsurance businesses. ACGL’s buyout of Allianz’s U.S. MidCorp and Entertainment insurance business has expanded its footprint in the middle-market property and casualty segment.A growing base of invested assets driven by improving cash flows should drive investment income.Sufficient liquidity coupled with low leverage has helped ACGL strengthen its balance. It also shields it from market volatility and supports growth initiatives. Notably, its free cash flow conversion has remained more than 85% over the last many quarters, reflecting its solid earnings.\nOptimistic Growth Projection\nThe Zacks Consensus Estimate for 2024 earnings is pegged at $8.99 per share, suggesting an increase of 6.4% on 20.9% higher revenues of $16.3 billion. The consensus estimate for 2025 earnings per share is $9.11, suggesting an increase of 1.3% on 14.1% higher revenues of $18.6 billion. The long-term earnings growth rate is projected to be 7%. We expect the 2026 bottom line to witness a three-year CAGR of 4.2%. \nArch Capital Trading at a Premium to Industry\nACGL shares are trading at a price-to-book multiple of 1.8, higher than the industry average of 1.6.The company has a Value Score of A.  \nImage Source: Zacks Investment Research\nIt is attractively valued compared with Fidelity National Financial, Inc. FNF and W.R. Berkley Corporation WRB but is expensive compared to CNA Financial CNA.\nParting Thoughts\nArch Capital boasts a strong product portfolio and has a solid track record of premium growth. Both the Insurance and Reinsurance segments should continue to witness significant growth from increases in most lines of business. A robust capital position over the years reflects its financial flexibility. Given the premium valuation and negative analyst sentiment on the stock, it is better to stay cautious on the Zacks Rak #3 (Hold) stock.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.\nWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report\nW.R. Berkley Corporation (WRB) : Free Stock Analysis Report\nCNA Financial Corporation (CNA) : Free Stock Analysis Report\nFidelity National Financial, Inc. (FNF) : Free Stock Analysis Report\nArch Capital Group Ltd. (ACGL) : Free Stock Analysis Report\nTo read this article on Zacks.com click here.\nZacks Investment Research","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2486838644"}