Wunderlich Securities Raises Harleysville Group PT Following $1.44 Dividend

On November 1, 2010, Harleysville Group

surprised investors with a $1.44 special dividend, Wunderlich Securities reports. HGIC also reported operating EPS of $0.76 compared to $0.83 a year ago. “Our estimate was $0.79 and the consensus was $0.78,” Wunderlich Securities writes. “HGIC experienced $3.7 million, or $0.09 per share, in catastrophe losses during 3Q10, which reduced earnings below our expectation.” Wunderlich Securities said that positive top-line performance and solid book value growth offset the EPS shortfall, adding, “We believe HGIC's ability to successfully manage the company's excess capital and grow the top line profitably supports a premium multiple.” Wunderlich Securities is raising its price target on HGIC to $40 from $37 to reflect 1.3 times 2011 estimated book value of $31.79.