The Hanover Insurance Group (NYSE:THG) Hits New 1-Year High - Should You Buy?

Key Points

• The Hanover Insurance Group (NYSE: THG) hit a new 52-week high, trading as high as $222.07, reflecting strong recent momentum in the stock.
• The company posted solid quarterly results, with EPS of $5.25 beating estimates and revenue of $1.70 billion topping expectations, while analysts currently rate the stock Moderate Buy on average.
• Hanover recently paid a quarterly dividend and authorized a $700 million share repurchase program, even as some insiders sold shares and institutional ownership remains high at 86.61%.

The Hanover Insurance Group, Inc. (NYSE:THG - Get Free Report) reached a new 52-week high on Monday . The company traded as high as $222.07 and last traded at $220.90, with a volume of 17566 shares trading hands. The stock had previously closed at $221.61.

Wall Street Analyst Weigh In

THG has been the topic of a number of analyst reports. Weiss Ratings raised The Hanover Insurance Group from a "buy (b+)" rating to a "buy (a-)" rating in a research report on Friday, May 22nd. Zacks Research raised The Hanover Insurance Group from a "hold" rating to a "strong-buy" rating in a report on Monday, May 4th. Morgan Stanley upped their target price on The Hanover Insurance Group to $220.00 and gave the company an "equal weight" rating in a research report on Monday. Keefe, Bruyette & Woods increased their target price on The Hanover Insurance Group from $208.00 to $211.00 and gave the stock an "outperform" rating in a report on Thursday, May 7th. Finally, Royal Bank Of Canada raised their price target on The Hanover Insurance Group from $190.00 to $195.00 and gave the stock a "sector perform" rating in a research report on Friday, May 1st. Two analysts have rated the stock with a Strong Buy rating, five have given a Buy rating and three have given a Hold rating to the stock. Based on data from MarketBeat, the company presently has an average rating of "Moderate Buy" and an average target price of $210.57.

The Hanover Insurance Group Trading Down 0.8%

The firm has a market capitalization of $7.69 billion, a price-to-earnings ratio of 11.07 and a beta of 0.28. The company has a debt-to-equity ratio of 0.22, a current ratio of 0.37 and a quick ratio of 0.37. The firm's 50-day simple moving average is $195.15 and its 200 day simple moving average is $182.77.

The Hanover Insurance Group (NYSE:THG - Get Free Report) last released its earnings results on Wednesday, April 29th. The insurance provider reported $5.25 earnings per share for the quarter, topping the consensus estimate of $4.14 by $1.11. The Hanover Insurance Group had a return on equity of 21.55% and a net margin of 10.77%.The firm had revenue of $1.70 billion during the quarter, compared to analysts' expectations of $1.58 billion. During the same period in the prior year, the company earned $3.87 earnings per share. The company's quarterly revenue was up 6.1% on a year-over-year basis. Equities analysts expect that The Hanover Insurance Group, Inc. will post 18.36 earnings per share for the current year.

The Hanover Insurance Group Announces Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Friday, June 26th. Investors of record on Friday, June 12th were given a dividend of $0.95 per share. This represents a $3.80 annualized dividend and a dividend yield of 1.7%. The ex-dividend date was Friday, June 12th. The Hanover Insurance Group's dividend payout ratio is currently 19.12%.

The Hanover Insurance Group announced that its Board of Directors has authorized a stock repurchase program on Wednesday, May 13th that allows the company to buyback $700.00 million in shares. This buyback authorization allows the insurance provider to purchase up to 10.6% of its stock through open market purchases. Stock buyback programs are often an indication that the company's leadership believes its shares are undervalued.

Insiders Place Their Bets

In other The Hanover Insurance Group news, CEO John C. Roche sold 8,358 shares of The Hanover Insurance Group stock in a transaction dated Wednesday, May 20th. The stock was sold at an average price of $193.74, for a total value of $1,619,278.92. Following the transaction, the chief executive officer owned 141,011 shares in the company, valued at $27,319,471.14. The trade was a 5.60% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. Also, Director Cynthia Egan sold 3,400 shares of the business's stock in a transaction dated Friday, May 1st. The stock was sold at an average price of $188.50, for a total value of $640,900.00. Following the transaction, the director directly owned 9,359 shares of the company's stock, valued at approximately $1,764,171.50. The trade was a 26.65% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold a total of 29,508 shares of company stock valued at $5,704,651 over the last ninety days. 2.80% of the stock is owned by insiders.

Hedge Funds Weigh In On The Hanover Insurance Group

A number of institutional investors have recently added to or reduced their stakes in THG. Norges Bank acquired a new stake in The Hanover Insurance Group in the fourth quarter valued at approximately $83,817,000. Alliancebernstein L.P. lifted its stake in shares of The Hanover Insurance Group by 36.1% in the 2nd quarter. Alliancebernstein L.P. now owns 1,280,418 shares of the insurance provider's stock valued at $217,505,000 after acquiring an additional 339,896 shares during the last quarter. AQR Capital Management LLC boosted its holdings in shares of The Hanover Insurance Group by 37.8% during the 3rd quarter. AQR Capital Management LLC now owns 763,431 shares of the insurance provider's stock valued at $137,967,000 after acquiring an additional 209,616 shares in the last quarter. Invesco Ltd. boosted its holdings in shares of The Hanover Insurance Group by 44.1% during the 4th quarter. Invesco Ltd. now owns 646,910 shares of the insurance provider's stock valued at $118,236,000 after acquiring an additional 197,930 shares in the last quarter. Finally, Balyasny Asset Management L.P. grew its position in The Hanover Insurance Group by 206.0% during the 3rd quarter. Balyasny Asset Management L.P. now owns 292,121 shares of the insurance provider's stock worth $53,058,000 after acquiring an additional 196,655 shares during the last quarter. 86.61% of the stock is currently owned by institutional investors and hedge funds.

About The Hanover Insurance Group

The Hanover Insurance Group, Inc NYSE: THG is a property and casualty insurance company that provides a range of commercial and personal insurance products. Through its subsidiary companies, Hanover offers coverage for businesses of all sizes, including workers' compensation, general liability, commercial auto, and professional liability. On the personal lines side, the company underwrites homeowners, personal auto, flood, and umbrella policies designed to meet the needs of individuals and families.

In addition to its core commercial and personal insurance offerings, Hanover maintains a specialty arm that focuses on niche markets through tailored product solutions.

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