AXIS Capital Holdings Limited AXS recently announced its decision to acquire general aviation insurance and reinsurance leader, Aviabel. The buyout will enable the property and casualty (P&C) insurer to boost its scale and relevance in the global aviation market. The financial details of the deal were not disclosed.
Aviabel is an expert in providing insurance and reinsurance solutions for the general aviation sector. Moreover, the acquiree’s strength lies in its robust portfolio of partnerships and clients across the world, as well as a solid level of gross premiums written. Apart from the general aviation sector, Aviabel provides its products and services to airlines, airports, and aerospace manufactures to name a few. Post acquisition, Aviabel will continue to operate from its current locations in Brussels and Amsterdam.
The buyout is also expected to benefit Aviabel as the company will utilize the financial strength and resources of the acquirer to improve its services and programs. The transaction will mark the beginning of a new chapter for the acquired company and its team.
With Aviabel on board, AXIS Capital will be able to diversify its presence in the general aviation and smaller account segments. Moreover, the buyout will allow the P&C insurer to extend its geographic footprint. We believe that Aviabel, with an entrepreneurial edge and commitment to its clients and employees, is a perfect fit for the acquirer.
AXIS Capital has been focusing on the expansion and improvement of its capabilities and hence, has been making strategic acquisitions. This should enable the P&C insurer to ramp up growth and improve its results.
Shares of AXIS Capital have outperformed the Zacks-categorized P&C industry since it posted solid third-quarter results. This price performance is backed by a positive estimate revision. The company has witnessed upward revisions in its 2016 and 2017 estimates over the last 60 days. Also, this Zacks Rank #2 (Buy) insurer delivered straight four quarter of positive surprise.
Stocks to Consider
Some better-ranked stocks from the same space include Alleghany Corporation Y, NMI Holdings, Inc. NMIH and Arch Capital Group Ltd. ACGL. Each of these stocks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Alleghany Corporation deals with P&C reinsurance and insurance businesses in the U.S. and internationally. The company delivered positive surprises in three of the last four quarters with an average beat of 20.52%.
NMI Holdings offers private mortgage guaranty insurance services in the U.S. The company delivered positive surprises in all of the last four quarters with an average beat of 62.80%.
Arch Capital offers property, casualty, and mortgage insurance and reinsurance products worldwide. It delivered positive surprises in all of the last four quarter with an average beat of 9.27%.
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