- Wells Fargo analyst Elyse Greenspan recommends going long on reinsurers and pairing that trade against insurance brokers given the relatively quiet hurricane season.
- Greenspan recommends buying a group of reinsurers including Arch Capital (NASDAQ:ACGL), Axis Capital (NYSE:AXS), Everest Re (NYSE:RE) and RenaissanceRe (NYSE:RNR).
- Q3-to-date global insured losses estimated at $10.8B-$16.6B, a below-average cat loss quarter, according to Wells Fargo.
- If the rest of the season remains light, reinsurance stock should outperform in September and October, increasing earnings and book-value growth.
- Source: Bloomberg First Word.
- Previously: Aspen-Apollo deal may lead to more insurer M&A: KBW (Aug. 28)