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Research Alert: CFRA Keeps Strong Buy Opinion On Shares Of Arch Capital Group Ltd.
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Research Alert: CFRA Keeps Strong Buy Opinion On Shares Of Arch Capital Group Ltd.
Nov 3, 2025 12:23 AM

03:00 AM EST, 11/03/2025 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We cut our target by $7 to $103, valuing ACGL at 10x our newly initiated 2027 operating EPS estimate of $10.30 and at 10.4x our 2026 EPS of $9.90, vs. its three year avg. forward multiple and the peer avg. of 11x. We lift our 2025 EPS by $0.94 to $9.24, as Q3 EPS of $2.77 (vs. $1.99) beat our $1.78 estimate and the $2.25 consensus. Results reflected 7.6% higher operating revenues on 8% higher earned premiums, a 2.3% rise in investment income, and higher other underwriting income. Underwriting results benefited from an 8.4% drop in loss costs, partly offset by 15% higher acquisition expenses. 9M operating revenues +16% Y/Y, and we see operating revenues +13%-18% in 2025 and +8%-15% in 2026, on a more competitive reinsurance pricing and demand environment. We acknowledge these pressures are a headwind, but ACGL continues to produce top line growth and underwriting profitability above peers, yet the shares currently trade at 9.3x our 2025 EPS estimate, a discount to both peer and historical averages.

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