Quick Win by the Algorithm: XL Group Ltd (NYSE: XL) Finishes The Q4 2017 And Launches Towards 2018 with 28,70% In 7 Days

Quick Win by the Algorithm

XL group logo

[Source: Wikimedia Commons]

“XL’s fourth quarter and full year 2017 results were impacted by the severe natural catastrophes in the year. At the same time, we feel positive about where we are going due to some important factors including: our solid capital position, our progress made in our 2017 ex-catastrophe underlying results, the strength of our market relevance as demonstrated by our 8 percent growth in gross written premiums year-over-year, and that we are seeing early signs of a return to realistic and sustainable rate…”

– Mike McGavick,  XL’s Chief Executive Officer

Over the past 7 days XL Group (NYSE: XL) stock price jumped by 29.38% from $43.26 to $55.99 per share, outperforming the industry’s index (NYSE) by some 27% during this period. XL’s bullish stock performance followed the company’s press release of the results for Q4 2017 with the following highlights:

  • Natural catastrophe pre-tax losses net of reinsurance, reinstatement and premium adjustments and
    redeemable non-controlling interest for the quarter of $315.2 million (11.5 points to the loss ratio),
    compared to $246.1 million (10.1 points to the loss ratio) in the prior year quarter, and $2.0 billion (19.7
    points to the loss ratio) for the full year, compared to $636.3 million (6.6 points to the loss ratio) for the
    prior year
  • P&C combined ratio of 108.3%, or 90.2%, excluding PYD and natural catastrophe losses, for the full year
    compared to 94.2%, or 90.7%, respectively, for the prior year
  • Fully diluted book value per common share of $38.04 at December 31, 2017, a decrease of $0.23, or 0.6%,
    from fully diluted book value per common share of $38.27 at September 30, 2017, and a decrease of $2.29,
    or 5.7%, from fully diluted book value per common share of $40.33 at December 31, 2016

Based on the above, one can see that the company experienced hard times in terms of pre-tax losses and fully diluted book value per common share. On the other hand, P&C combined ratio including PYD improved significantly from 94.2% to 108.3%. The latest Yahoo Finance data supports that positive outlook and shows that 8 out of 16 analysts took the buy position with regards to XL’s stock.

XL yahoo graph

[Source: Yahoo Finance]

On February 26th, 2018, I Know First issued a bullish 7 days forecast for XL’s stock. the forecast illustrated a signal of 6.50 and a predictability of 0.15. In accordance with the forecast, XL’s stock returned 28.70% over this period, highlighting the accuracy of the prediction produced by the I Know First algorithm.

XL IKF forecast days

Current I Know First subscribers received this bullish XL forecast on February 26th, 2018.

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Overview of the Company

XL Group Ltd, through its subsidiaries, operates as an insurance and reinsurance company worldwide. The company’s Insurance segment offers primary and excess casualty, environmental liability, professional liability, property, excess and surplus lines, U.S. program/facilities, and construction business products. It also provides property and casualty products; insurance coverages for program administrators and managing general agents; mergers and acquisitions, and structured risk solutions; construction-related products and risk engineering services; and advanced loss of profits/delay in start-up, annual facilities for employers and contractors, commercial project builders, construction/contractors all risks, engineering/erection all risks, machinery breakdown, and other products. In addition, this segment offers aviation and satellite, marine, fine art and specie, private client, equine, livestock and aquaculture, energy, crisis management, political risk, credit and bond, London wholesale property and casualty, life, accident, and health products. The Reinsurance segment provides casualty reinsurance products, including general and professional liability, and automobile liability and workers’ compensation; property reinsurance products comprising property catastrophe, risk excess of loss, and proportional products; specialty reinsurance products, such as energy, marine, aviation, and space; and other reinsurance products that include fidelity, surety, trade credit, accident and health, mortgage, and political risk. It also writes whole account capital gearing quota share contracts on select syndicates at Lloyd’s. The company markets its products and services to the industrial, commercial, and professional firms; insurance companies; and other enterprises through international, national, and regional producers, acting as the brokers and representatives of policyholders. XL Group Ltd was founded in 1986 and is headquartered in Hamilton, Bermuda.