Keefe, Bruyette & Woods Forecasts Strong Price Appreciation for Arch Capital Group (NASDAQ:ACGL) Stock

Key Points

• Keefe, Bruyette & Woods raised its price target on Arch Capital to $105 (from $104) while maintaining a "market perform" rating, implying roughly an 8.09% upside from the prior close.
• Arch beat quarterly expectations with EPS of $2.98 (vs. $2.34 est.) and revenue of $4.93B (vs. $3.94B), yet analysts' consensus price target is $109.27 and the average rating remains "Hold".
• Insiders have been net sellers (78,267 shares, about $7.29M last quarter) while institutional investors own roughly 89.07% of the company's stock.

Arch Capital Group (NASDAQ:ACGL - Get Free Report) had its price target raised by equities research analysts at Keefe, Bruyette & Woods from $104.00 to $105.00 in a research note issued on Tuesday,Benzinga reports. The brokerage presently has a "market perform" rating on the insurance provider's stock. Keefe, Bruyette & Woods' price target suggests a potential upside of 8.09% from the stock's previous close.

A number of other research firms have also issued reports on ACGL. Morgan Stanley set a $125.00 price objective on Arch Capital Group in a research note on Friday, January 16th. UBS Group reaffirmed a "buy" rating and set a $114.00 target price (up from $113.00) on shares of Arch Capital Group in a report on Tuesday, February 17th. The Goldman Sachs Group reiterated a "sell" rating and set a $93.00 price target (up from $84.00) on shares of Arch Capital Group in a research report on Wednesday, January 7th. Evercore set a $100.00 price target on shares of Arch Capital Group and gave the stock an "in-line" rating in a report on Wednesday, January 7th. Finally, Citigroup reaffirmed a "buy" rating and set a $120.00 price objective (up from $113.00) on shares of Arch Capital Group in a research note on Friday, February 13th. Nine equities research analysts have rated the stock with a Buy rating, eight have issued a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat.com, the company currently has an average rating of "Hold" and a consensus price target of $109.27.

Arch Capital Group Stock Performance

ACGL traded up $0.35 on Tuesday, hitting $97.14. The company's stock had a trading volume of 671,672 shares, compared to its average volume of 1,989,222. Arch Capital Group has a 12 month low of $82.44 and a 12 month high of $103.39. The firm has a market cap of $34.61 billion, a P/E ratio of 8.35, a price-to-earnings-growth ratio of 3.94 and a beta of 0.41. The company has a quick ratio of 0.53, a current ratio of 0.53 and a debt-to-equity ratio of 0.13. The company's 50 day simple moving average is $96.71 and its 200-day simple moving average is $93.46.

Arch Capital Group (NASDAQ:ACGL - Get Free Report) last issued its earnings results on Monday, February 9th. The insurance provider reported $2.98 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $2.34 by $0.64. Arch Capital Group had a net margin of 22.07% and a return on equity of 16.73%. The business had revenue of $4.93 billion for the quarter, compared to analysts' expectations of $3.94 billion. During the same quarter in the previous year, the firm posted $2.26 EPS. Analysts forecast that Arch Capital Group will post 8.42 EPS for the current year.

Insiders Place Their Bets

In related news, Director Brian S. Posner sold 3,000 shares of the company's stock in a transaction that occurred on Wednesday, March 11th. The shares were sold at an average price of $17.11, for a total value of $51,330.00. Following the transaction, the director directly owned 2,000 shares in the company, valued at approximately $34,220. This represents a 60.00% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. Also, insider David Gansberg sold 5,907 shares of the firm's stock in a transaction that occurred on Tuesday, March 10th. The shares were sold at an average price of $96.37, for a total transaction of $569,257.59. Following the completion of the sale, the insider directly owned 336,559 shares in the company, valued at $32,434,190.83. This represents a 1.72% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last quarter, insiders sold 78,267 shares of company stock worth $7,291,637. 4.20% of the stock is currently owned by insiders.

Hedge Funds Weigh In On Arch Capital Group

Institutional investors have recently made changes to their positions in the stock. WCM Investment Management LLC grew its position in Arch Capital Group by 1.3% in the third quarter. WCM Investment Management LLC now owns 13,525,402 shares of the insurance provider's stock worth $1,214,987,000 after acquiring an additional 171,693 shares in the last quarter. JPMorgan Chase & Co. raised its position in Arch Capital Group by 4.6% during the third quarter. JPMorgan Chase & Co. now owns 8,190,927 shares of the insurance provider's stock valued at $743,168,000 after purchasing an additional 360,626 shares in the last quarter. Norges Bank bought a new stake in Arch Capital Group during the fourth quarter worth about $463,208,000. Morgan Stanley boosted its holdings in shares of Arch Capital Group by 0.8% in the 4th quarter. Morgan Stanley now owns 4,289,082 shares of the insurance provider's stock worth $411,409,000 after purchasing an additional 33,132 shares in the last quarter. Finally, Goldman Sachs Group Inc. boosted its holdings in shares of Arch Capital Group by 5.7% in the 4th quarter. Goldman Sachs Group Inc. now owns 2,949,978 shares of the insurance provider's stock worth $282,962,000 after purchasing an additional 160,326 shares in the last quarter. Institutional investors own 89.07% of the company's stock.

About Arch Capital Group

Arch Capital Group Ltd. NASDAQ: ACGL is a Bermuda-based insurance and reinsurance holding company that underwrites a broad range of property and casualty, mortgage, and specialty risk products. The company operates through a group of underwriting subsidiaries and platforms to provide insurance, reinsurance and related risk solutions tailored to commercial, institutional and individual clients.

Arch's product mix includes treaty and facultative reinsurance, primary casualty and property insurance, mortgage insurance and other specialty lines.

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