Navigators acquisition adding little upside
HIG announced the acquisition of Navigators, a globally active specialty underwriter, for $2.1bn in cash. The transaction is to become net income accretive in FY20. However, there is an opportunity cost, which is the implicit decision not to restart the buyback in the near term. Our preliminary analysis suggests that the transaction is mildly EPS dilutive as we push back the expected restart of the buyback from FY19 to FY20. We have not changed our forecasts at this stage given the closing is not expected until 1H19. We retain our Neutral recommendation.Hartford Financial Services Group is a holding company. Through its subsidiaries, the company provides property and casualty insurance, group benefits insurance and services, and mutual funds and exchange-traded products. The company has five segments: Commercial Lines, which provides automobile, property, general liability, and marine coverages; Personal Lines, which provides automobile and homeowners coverages; Property and Casualty Other Operations, which provides group life, group disability, and other products; and Hartford Funds, which provides mutual fund, exchange-traded products, and Talcott Resolution life and annuity separate accounts.
Formed in 2003 by an established team from Cazenove, one of the most respected investment banks in the UK, Atlantic Equities conducts and publishes fundamental, bottom up research on mid and large cap US companies.
Atlantic provide order execution through a wide range of DMA products and algorithmic trading suites.
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