Analysts Upgrade Alterra From Hold To Buy
Bermuda’s Alterra Capital Holdings has today [Oct.28] been upgraded by TheStreet Ratings from hold to buy.
The stock analysts say the company’s strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and solid stock price performance.
“We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share,” said TheStreet.
Highlights from TheStreet’s ratings report include:
- Aletrra’s revenue growth has slightly outpaced the industry average of 20.7 percent. Since the same quarter one year prior, revenues rose by 21.5 percent. This growth in revenue does not appear to have trickled down to the company’s bottom line, displayed by a decline in earnings per share. Alterra’s debt-to-equity ratio is very low at 0.16 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company’s weak earnings results. Turning its attention to the future direction of the stock, TheStreet said it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- Alterra Capital Holdings Ltd. has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last year. TheStreet anticipate that this should continue in the coming year. During the past fiscal year, Alterra Capital Holdings reported lower earnings of $3.15 versus $4.26 in the prior year. For the next year, the market is expecting a contraction of 62.7 percent in earnings [$1.18 versus $3.15].
Alterra Capital Holdings Limited, through its subsidiaries, provides specialty insurance and reinsurance products to corporations, public entities, and property and casualty insurers principally in Bermuda, Ireland, the United States, and the United Kingdom.
