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nsurer Chubb Corp. (CB), which I first discussed here on May 29, 2009, continues to impress me amid choppy seas.A thinning insurance sector, triggered by the U.S. and world's worst financial crisis since the 1930s, has put Chubb in the catbird seat.
The strength of Chubb's operation, in a nutshell: a strong personal insurance brand, a diversified business (personal lines, commercial insurance, specialty insurance), and a stronger balance sheet than many competitors. These strengths should translate into continued market share gains for CB in 2010. Further, pricing is showing signs of bottoming/firming.
The First Call FY2010/FY2011 EPS estimates for CB are $5.41 to $5.53.
Technically, Chubb's stock has moved back above psychological resistance at $50; there will be resistance at/near $55, but once that is cleared $60 and beyond should follow shortly, according to my analysis.
2010 Outlook: I view Chubb Corp as a long-term play, but if investors are looking to sell CB within the year, it's probably best to take your profits after it rises to $58-$59, if it fails to hurdle $60.
Stock Analysis: I consider Chubb Corp to be a moderate-risk stock. If an investor has already purchased the company's shares, I'd hold them. If not, I'd consider buying a 25% position in CB now; then buy another 25% in one month, if U.S. and global economic conditions don't worsen substantially. Under any circumstance, I wouldn't buy more than 75% of my CB position before April 2010 and I'd put a sell/stop loss at: $39.
Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.
Technically, Chubb's stock has moved back above psychological resistance at $50; there will be resistance at/near $55, but once that is cleared $60 and beyond should follow shortly, according to my analysis.
2010 Outlook: I view Chubb Corp as a long-term play, but if investors are looking to sell CB within the year, it's probably best to take your profits after it rises to $58-$59, if it fails to hurdle $60.
Stock Analysis: I consider Chubb Corp to be a moderate-risk stock. If an investor has already purchased the company's shares, I'd hold them. If not, I'd consider buying a 25% position in CB now; then buy another 25% in one month, if U.S. and global economic conditions don't worsen substantially. Under any circumstance, I wouldn't buy more than 75% of my CB position before April 2010 and I'd put a sell/stop loss at: $39.
Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.
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