UPDATE: Nomura Reiterates on ACE Limited Following Strong 3Q13 Report

In a report published Wednesday, Nomura analyst Clifford Gallant reiterated a Buy rating on ACE Limited ACE, and raised the price target from $105.00 to $109.00. In the report, Nomura noted, “ACE reported a strong 3Q13, with operating EPS of $2.49 beating our $2.13 and the Street's $2.24. We are seeing meaningful growth and benefit from acquisitions, with ex. crop and F/X premiums up 10.5%. The company-wide combined ratio was an impressive 86.5% and the accident year ex. cats was 89.7%, ahead of our 90.6%. Releases were $210m vs. our $102 estimate. Guidance for 2013 was raised to $8.65-8.90, reflecting the strong 3Q result. This implies a 4Q13 range of $1.70-1.95, before reserve releases. We reiterate our Buy rating. With accelerating premium volumes and stable EPS growth, ACE is proving the value of its position as a global specialty insurer and reinsurer. Over time, we expect ACE to command premium valuations. We are raising our target price to $109 from $105, approximately 1.2x forward book, to reflect the improving growth.” ACE Limited closed on Tuesday at $97.80.