The Hanover Insurance Group (NYSE:THG) Reaches New 12-Month High Following Better-Than-Expected Earnings

Key Points

• The Hanover Insurance Group beat quarterly expectations, reporting EPS of $5.31 versus the $3.84 consensus and revenue of $1.73 billion versus $1.65 billion expected. Revenue rose 4.6% year over year, helping shares reach a new 52-week high near $228.56.
• The company maintains a quarterly dividend of $0.95 per share, equivalent to a 1.6% yield, and authorized a $700 million share repurchase program covering up to 10.6% of outstanding shares.
• Analysts hold a “Moderate Buy” consensus rating with an average price target of $220.43, while insiders sold 29,508 shares worth approximately $5.7 million over the past 90 days.

The Hanover Insurance Group, Inc. (NYSE:THG - Get Free Report)'s share price reached a new 52-week high on Wednesday after the company announced better than expected quarterly earnings. The stock traded as high as $228.05 and last traded at $228.5550, with a volume of 21611 shares changing hands. The stock had previously closed at $224.15.

The insurance provider reported $5.31 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $3.84 by $1.47. The company had revenue of $1.73 billion for the quarter, compared to the consensus estimate of $1.65 billion. The Hanover Insurance Group had a return on equity of 21.55% and a net margin of 10.77%.The firm's revenue was up 4.6% compared to the same quarter last year. During the same period in the previous year, the business earned $4.35 EPS.

The Hanover Insurance Group Dividend Announcement

The firm also recently announced a quarterly dividend, which was paid on Friday, June 26th. Shareholders of record on Friday, June 12th were issued a dividend of $0.95 per share. The ex-dividend date of this dividend was Friday, June 12th. This represents a $3.80 dividend on an annualized basis and a yield of 1.6%. The Hanover Insurance Group's payout ratio is presently 19.12%.

The Hanover Insurance Group announced that its board has initiated a stock buyback program on Wednesday, May 13th that permits the company to repurchase $700.00 million in outstanding shares. This repurchase authorization permits the insurance provider to repurchase up to 10.6% of its stock through open market purchases. Stock repurchase programs are generally a sign that the company's board of directors believes its stock is undervalued.

Analyst Upgrades and Downgrades

THG has been the topic of a number of recent analyst reports. BMO Capital Markets lowered shares of The Hanover Insurance Group from an "outperform" rating to a "market perform" rating and raised their price target for the stock from $194.00 to $203.00 in a report on Tuesday, May 19th. Morgan Stanley boosted their target price on shares of The Hanover Insurance Group from $220.00 to $225.00 and gave the company an "equal weight" rating in a report on Wednesday, July 8th. Royal Bank Of Canada lifted their price target on shares of The Hanover Insurance Group from $195.00 to $215.00 and gave the company a "sector perform" rating in a research report on Monday, July 13th. Oppenheimer boosted their price objective on shares of The Hanover Insurance Group from $205.00 to $220.00 and gave the stock an "outperform" rating in a research note on Thursday, May 21st. Finally, Keefe, Bruyette & Woods reissued a "market perform" rating and issued a $220.00 price target (up from $211.00) on shares of The Hanover Insurance Group in a research report on Wednesday, July 8th. One analyst has rated the stock with a Strong Buy rating, three have assigned a Buy rating and six have given a Hold rating to the company's stock. According to data from MarketBeat, The Hanover Insurance Group currently has a consensus rating of "Moderate Buy" and an average target price of $220.43.

Insider Buying and Selling

In other The Hanover Insurance Group news, CEO John C. Roche sold 8,358 shares of the firm's stock in a transaction that occurred on Wednesday, May 20th. The shares were sold at an average price of $193.74, for a total transaction of $1,619,278.92. Following the sale, the chief executive officer owned 141,011 shares in the company, valued at approximately $27,319,471.14. This trade represents a 5.60% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, EVP Denise Lowsley sold 4,175 shares of The Hanover Insurance Group stock in a transaction that occurred on Thursday, May 14th. The shares were sold at an average price of $191.73, for a total transaction of $800,472.75. Following the transaction, the executive vice president directly owned 3,883 shares in the company, valued at $744,487.59. This represents a 51.81% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold a total of 29,508 shares of company stock worth $5,704,651 in the last ninety days. Corporate insiders own 2.80% of the company's stock.

Institutional Investors Weigh In On The Hanover Insurance Group

Institutional investors have recently bought and sold shares of the business. JPL Wealth Management LLC bought a new stake in The Hanover Insurance Group during the third quarter valued at about $26,000. McMillan Office Inc. bought a new position in shares of The Hanover Insurance Group in the fourth quarter worth about $31,000. Entrust Financial LLC bought a new position in shares of The Hanover Insurance Group in the fourth quarter worth about $33,000. Root Financial Partners LLC grew its position in shares of The Hanover Insurance Group by 69.3% during the first quarter. Root Financial Partners LLC now owns 237 shares of the insurance provider's stock worth $41,000 after purchasing an additional 97 shares in the last quarter. Finally, IFP Advisors Inc grew its position in shares of The Hanover Insurance Group by 146.2% during the fourth quarter. IFP Advisors Inc now owns 256 shares of the insurance provider's stock worth $47,000 after purchasing an additional 152 shares in the last quarter. Hedge funds and other institutional investors own 86.61% of the company's stock.

The Hanover Insurance Group Price Performance

The firm has a 50 day moving average of $204.67 and a 200-day moving average of $186.57. The company has a market cap of $8.06 billion, a P/E ratio of 11.60 and a beta of 0.28. The company has a current ratio of 0.37, a quick ratio of 0.37 and a debt-to-equity ratio of 0.22.

The Hanover Insurance Group Company Profile

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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