B.Riley FBR Reiterates Their Buy Rating on James River Group

By Jason Carr

B.Riley FBR analyst Randy Binner reiterated a Buy rating on James River Group (NASDAQ: JRVR) today and set a price target of $47. The company’s shares closed yesterday at $38.49.

Binner wrote:

“We recently hosted meetings with JRVR management and came away with a number of incremental takeaways. The main debate on JRVR is what to do with the stock after the secondary on November 9, 2017. Shares of JRVR are down 8.4% since the secondary, and currently trade at 15x 2018E EPS versus peers at 25x. The sale included ~3 million shares from D.E. Shaw and 400,000 shares from former CEO, and now non-executive Chairman, Adam Abram. We view this sale as a routine diversification for an executive stepping down from managing day-to-day activities. In any case, this is now in the stock and we see no change to the intrinsic value of the shares. We reiterate our Buy rating and $47 price target, which is 18.8x 2018E EPS. Also, JRVR pays a 3.1% regular dividend and we believe that special dividends will add another 1.3% annually. The growth outlook for JRVR is picking up momentum and our reserve adequacy outlook remains favorable.”

According to TipRanks.com, Binner is a 5-star analyst with an average return of 15.5% and a 73.5% success rate. Binner covers the Financial sector, focusing on stocks such as American Equity Investment Life, American International Group, and State National Companies Inc.

James River Group has an analyst consensus of Strong Buy, with a price target consensus of $46.75.

Based on James River Group’s latest earnings report for the quarter ending September 30, the company posted quarterly revenue of $221 million and quarterly net profit of $10.35 million. In comparison, last year the company earned revenue of $151 million and had a net profit of $21.37 million.

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James River Group Holdings Ltd. engages in insurance business activities. The company owns and operates a group of specialty insurance and reinsurance companies. It operates through the following segments: Excess & Surplus Lines, Specialty Admitted Insurance, and Casualty Reinsurance.