UPDATE: Goldman Sachs Initiates Axis Capital Holdings Limited at Buy on Valuation, Capitalization

Goldman Sachs initiated coverage on Axis Capital Holdings Limited AXS with a Buy rating and a $43 price target. Goldman Sachs commented, "[W]e believe that the combination of ample capital and a low valuation, as together with its a recent strategy to reduce earnings volatility, will provide Axis an opportunity to grow book value faster than peers and deliver attractive ROEs, both of which should drive improved valuation. Although Axis has had its unique challenges in recent years, the company's cash generation has remained strong and today is higher than more expensive peers and in line with Arch, whose multiple is nearly 50% higher. We expect Axis will deploy almost 10% of its market capitalization annually in 2013-2014 (including a 2.7% dividend), providing Axis with a unique opportunity to grow book value through accretive buybacks." Axis Capital Holdings Limited closed at $35.91 on Wednesday.