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WR Berkley Corp WRB

Morningstar Rating
$82.69 −0.80 (0.96%)
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Company Report

W.R. Berkley Earnings: Higher Interest Rates and a Hard Market Boost Returns

Coming into the year, we thought narrow-moat W.R. Berkley was the best-positioned P&C insurer in our coverage, and we think the company’s fourth-quarter results further justify that opinion. The company continues to see strong underwriting results amid a hard market, and higher interest rates are boosting investment returns. The net result was an annualized ROE of 24% for the quarter and 21% for the full year. We will maintain our $65 per share fair value estimate and view the shares as modestly overvalued right now. We think the near-term strength is leading the market to an overly optimistic view from a long-term perspective, and the stock currently trades at a hefty premium to its average historical book multiple.

Price vs Fair Value

WRB is trading at a 27% premium.
Price
$82.69
Fair Value
$14.00
Uncertainty
Medium
1-Star Price
$85.82
5-Star Price
$27.20
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

A decentralized operating structure allows Berkley to develop expertise in a number of profitable niche fields.

Bears

The company's reinsurance operations are a drag on overall results.

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News

Trading Information

Previous Close Price
$83.49
Day Range
$82.6983.75
52-Week Range
$55.5086.33
Bid/Ask
$82.69 / $86.96
Market Cap
$21.21 Bil
Volume/Avg
906,727 / 1.2 Mil

Key Statistics

Price/Earnings (Normalized)
16.74
Price/Sales
1.87
Dividend Yield (Trailing)
0.53%
Dividend Yield (Forward)
0.53%
Total Yield
3.06%

Company Profile

W.R. Berkley is an insurance holding company with a host of subsidiaries that primarily underwrite commercial casualty insurance. The firm specializes in niche products that include various excess and surplus lines, workers' compensation insurance, self-insurance consulting, reinsurance, and regional commercial lines for small and midsize businesses.
Sector
Financial Services
Industry
Insurance - Property & Casualty
Stock Style Box
Mid Core
Total Number of Employees
8,186

Competitors

Valuation

Metric
WRB
AIG
MKL
Price/Earnings (Normalized)
16.7410.7423.83
Price/Book Value
2.851.121.36
Price/Sales
1.871.121.27
Price/Cash Flow
16.745.4016.93
Price/Earnings
WRB
AIG
MKL

Financial Strength

Metric
WRB
AIG
MKL
Quick Ratio
Current Ratio
Interest Coverage
14.764.4015.34
Quick Ratio
No chart available

Profitability

Metric
WRB
AIG
MKL
Return on Assets (Normalized)
3.80%0.93%4.00%
Return on Equity (Normalized)
19.24%11.71%15.54%
Return on Invested Capital (Normalized)
14.67%2.49%12.11%
Return on Assets
WRB
AIG
MKL
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Insurance - Property & Casualty Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Economic Moat
Market Cap
PGR
Progressive CorpRpmdbrm$110.0 Bil
CB
Chubb LtdSdpgnxl$101.7 Bil
TKOMY
Tokio Marine Holdings Inc ADRXqwl$58.5 Bil
TKOMF
Tokio Marine Holdings IncPsyv$58.5 Bil
TRV
The Travelers Companies IncBtzhzcj$50.1 Bil
ALL
Allstate CorpVfkr$40.8 Bil
PPCCY
PICC Property and Casualty Co Ltd ADRJqgz$30.6 Bil
PPCCF
PICC Property and Casualty Co Ltd Class HMbn$30.6 Bil
MKL
Markel Group IncFwbs$19.6 Bil

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