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On Thursday, Keefe, Bruyette & Woods made an adjustment to Chubb Corporation’s (NYSE:CB) price target, reducing it slightly from $316.00 to $314.00, while continuing to endorse the stock with an Outperform rating. This change follows the company’s first-quarter earnings report and subsequent conference call for the year 2025.
Meyer Shields, an analyst from Keefe, Bruyette & Woods, provided insights into the reasoning behind the updated price target. Shields cited a combination of factors, including anticipated slower growth in investment income, an increase in expense ratios, and a decrease in Life income. These elements are expected to affect Chubb’s earnings per share (EPS) for the years 2025 and 2026, leading to a slight revision in EPS estimates to $21.40 and $26.20, down from previous figures of $21.45 and $26.30, respectively.
Despite the reduction in the price target and EPS estimates, Shields remains confident in Chubb’s ability to outperform the market. The analyst expects that the company’s robust organic and inorganic growth, coupled with a continued expansion in core underwriting margins, will propel Chubb forward. This optimism is supported by the resilience of property and casualty (P&C) pricing, which is anticipated to contribute to the company’s success in the coming year.
Shields’ analysis suggests that the lowered core P&C loss ratios could partially offset the negative factors impacting Chubb’s financial outlook. This balance between challenges and strengths forms the basis for the maintained Outperform rating.
In summary, while there is a minor adjustment to Chubb’s price target and EPS estimates, the overall perspective from Keefe, Bruyette & Woods remains positive. The firm anticipates that Chubb Corporation will continue to deliver strong performance and drive shareholder value over the next twelve months.
In other recent news, Chubb Limited reported a 31% decline in core operating income for the first quarter of 2025, totaling $1 billion. Despite this decrease, the company experienced a 5.7% growth in total premiums in constant dollars. Chubb’s investments in technology continue, with an annual expenditure of $1.1-1.2 billion aimed at modernization and improved processing capabilities. The company’s book value per share reached an all-time high of $164, and $751 million was returned to shareholders through buybacks and dividends. Additionally, Chubb’s acquisition of Liberty Mutual’s business in Thailand and Vietnam contributed $275 million in premiums, marking a strategic expansion in Asia.
In related developments, Raymond (NSE:RYMD) James has raised its price target for Chubb from $320 to $340, maintaining a Strong Buy rating. Analyst Gregory Peters from Raymond James highlighted Chubb’s potential for double-digit core operating earnings growth by 2026, supported by stable underlying results. The new price target reflects a valuation of 13.1 times Raymond James’ 2025 operating earnings per share estimate for Chubb. This valuation is compared to the stock’s five-year average multiple of 14 times and the property and casualty industry peer average of 17.4 times. The firm’s analysis suggests that Chubb’s shares are trading at a discount to both its historical average and the broader industry average, presenting an attractive investment proposition.
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