Is Assurant Stock Outperforming the Dow?

Atlanta, Georgia-based Assurant, Inc. (AIZ) is a global provider of risk management solutions in the housing and lifestyle markets, protecting where people live and the goods they buy. With a market cap of over $11 billion, Assurant’s operations span the Americas, Indo-Pacific, and Europe.

Companies worth $10 billion or more are generally described as "large-cap stocks," Assurant fits right into that category, with its market cap exceeding this threshold, reflecting its substantial size and influence in the property & casualty insurance industry. The company employs over 13,000 people and has protected nearly 300 million consumers worldwide.

The stock touched its all-time high of $230.55 on Nov. 25 and is currently trading 6.7% below that peak. AIZ has gained 7.6% over the past three months, outperforming the Dow Jones Industrials Average’s ($DOWI) 1.6% gains during the same time frame.

Over the longer term, Assurant’s performance looks even more impressive. AIZ has surged 28.6% over the past six months and 29.3% over the past 52 weeks, significantly outperforming DOWI’s 9.8% gains over the past six months and 14.2% returns over the past year.

To confirm the bullish trend, AIZ has traded mostly above its 200-day moving average over the past year and above its 50-day moving average since mid-July with some fluctuations.

Assurant’s stock prices soared 6.9% in the trading session after the release of its better-than-expected Q3 results on Nov. 5. The company reported a 7% year-over-year growth in total revenues, reaching approximately $3 billion, exceeding Wall Street’s topline expectation. Moreover, its adjusted EPS of $3.00 also surpassed analysts’ bottom-line estimate by a staggering 20%, boosting investors’ confidence.

Despite beating analysts’ estimates, AIZ’s profitability took a sharp hit. The company observed a massive 20.5% increase in policyholder benefits compared to the year-ago quarter to $776.8 million and a notable 7.4% rise in underwriting, selling, general and admin expenses to over $2 billion. The surge in these expenses led to a massive 29.6% decline in net income to $133.8 million.

While Assurant has outperformed its peer The Allstate Corporation’s (ALL) 21.1% gains over the past six months, it has lagged behind ALL’s 40% surge over the past 52 weeks.

Among the seven analysts covering the AIZ stock, the consensus rating is a “Moderate Buy.” Its mean price target of $233.20 represents an 8.4% premium to current price levels.