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Tuesday, TD Cowen analysts maintained a Buy rating on AXIS Capital (NYSE:AXS) with a steady price target of $127.00, highlighting the insurer’s robust outlook for 2025. The $7.66 billion market cap company, which maintains a "GREAT" financial health score according to InvestingPro analysis, demonstrated strong underwriting practices during a meeting with CEO Vince Tizzio and CFO Peter Vogt. The firm’s premium growth, margins, and reserve strength were reaffirmed, along with their cautious stance on liability insurance and reinsurance. For investors seeking deeper insights, InvestingPro offers 10 additional key tips about AXIS Capital’s performance and prospects.
AXIS Capital’s management expressed confidence in various growth drivers, including the introduction of new products, the exploration of Excess & Surplus (E&S) opportunities, and an anticipated rise in investment income. These factors are expected to contribute positively to the company’s financial performance in the coming years.
The valuation of AXIS Capital was described as compelling by the analysts, who noted that the stock is currently trading at 7.5 times its estimated 2026 earnings per share (EPS), compared to its specialty insurance peers, which trade at an average of 19.5 times. The company’s valuation is informed by a sum-of-parts analysis, using segment multiples based on peer valuations relative to the anticipated 2026 adjusted EPS.
The analysts further elaborated that AXIS Capital’s Insurance segment, which primarily focuses on specialty insurance, is projected to generate approximately three-quarters of the company’s estimated earnings for 2026. This segment’s performance is a key factor in the firm’s positive assessment of AXIS Capital’s stock.
The $127 price target set by TD Cowen implies a 39% upside potential from the current levels, suggesting a strong investment opportunity in the eyes of the analysts. Their valuation approach considers the company’s earnings potential and how it stacks up against industry peers, underscoring the opportunity for investors.
In other recent news, AXIS Capital Holdings Limited has been making significant strides. Keefe, Bruyette & Woods has raised the company’s price target to $115, citing adjustments to earnings per share for a Loss Portfolio Transfer as the primary reason for the updated valuation. The firm’s analyst, Meyer Shields, has maintained an optimistic outlook for AXIS Capital’s performance despite a reduction in net investment income due to the pending LPT.
In addition to the revised price target, AXIS Capital has also announced a significant stock buyback. The company has repurchased 2,234,636 shares from Stone Point Capital for $200 million, a move that analysts at Keefe, Bruyette & Woods have expressed a positive outlook on.
Moreover, AXIS Capital has entered into a definitive agreement to repurchase approximately $200 million worth of its common shares from T-VIII PubOpps LP, a transaction set to decrease the Trident (NSE:TRIE) Funds’ ownership to around 5%.
On the ratings front, while JMP Securities maintained a Market Perform rating on AXIS Capital shares, TD Cowen reaffirmed a Buy rating and a $127.00 price target. These ratings came after AXIS Capital reported strong fourth-quarter results, including a combined ratio of 94.2% and a 14.3% year-over-year growth in net written premiums. These recent developments underscore AXIS Capital’s commitment to managing its capital efficiently and enhancing shareholder value.
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