Stephen Simpson, CFA
Long only, growth at reasonable price, value, research analyst

Endurance Specialty Still Undergoing Substantial Shifts

Endurance Specialty Holdings (NYSE:ENH) hasn't quite settled into its new normal yet, which makes quarter-to-quarter forecasting quite a bit more challenging. Expenses are still running high, but premium growth in the insurance business should lead to better leverage down the road. Still, there is a lot of uncertainty about the long-term profitability of business being written today in the insurance sector, and Endurance's pursuit of Aspen (NYSE:AHL) adds yet another layer of uncertainty. I seem to be a little more bullish than most sell-side analysts on Endurance's long-term profitability, as an assumption of a five-year ROE of 10% leads to a fair value estimate above $58.

Reserves Drive The Beat

Endurance delivered operating earnings about a...

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