Why W.R. Berkley Corporation (WRB) Is A Defensive Pick?

Pulling out from his long list of favorites, W.R. Berkley Corporation (NYSE:WRB) is one of the recommended stocks by Fox Business’ Charles Payne, as he said that the commercial insurance company is a defensive bet but yet a long time performer.

W.R. Berkley Corporation (NYSE:WRB)

Payne said: “The return in equity from 2003 to June of this year has crushed all of its larger, better known rivals.”¬†Further, the insurance company operates under three business segments, which are: domestic insurance, international insurance and global re-insurance, all of which have a track record of exceptional performance.

Payne based his recommendation on the fact that W.R. Berkley Corporation (NYSE:WRB) had managed to sail through rough patches in the industry, posting either no loss or at times, even a surplus.  For instance, Payne said that when the insurance industry posted an average loss of 4.3% during superstorm Sandy, W.R. Berkley Corporation (NYSE:WRB) had reported a surplus of roughly 1%. Another interesting figure came in during Katrina, which contributed to an average 113.8% industry loss, but the company had posted a nearly 1% surplus. Payne also mentioned that since there have been no significant calamities or catastrophes in the recent past, thus, the execution of the company has scaled even higher. During the last four quarters, the company has successfully topped the estimates by 3%, 4%, 10% and more recently by 27%.

Payne added that the remarkable performance put up by the company has led to upward revisions in estimates for its earnings, which are now kept at $3.87 per share as against $3.57 per share, a couple of months back. Overall, Payne considers that W.R. Berkley Corporation (NYSE:WRB) is a great stock to generate higher returns at this point of time. In the meanwhile, Matt McCall, founder of Penn Financial Group, stated that the company is best of the breed in the insurance segment and should definitely be a defensive pick.

Disclosure: none

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