Janney Initiates Everest Group at Buy, Sees Rebound Ahead After Reserve Reset

Janney initiated coverage on Everest Group (NYSE:EG) with a Buy rating and a fair value estimate of $425, highlighting the reinsurer’s strong long-term track record and attractive valuation following recent reserve adjustments.

Everest, a global leader in property and casualty reinsurance with an expanding footprint in primary insurance, has delivered consistent performance over the past 25 years—posting a median operating return on equity (ROE) of 12% and annual shareholder value growth averaging 11%.

Earlier this year, the company underwent two major developments: a CEO transition and a sizable $1.7 billion charge to strengthen casualty reserves, including a nearly $500 million risk margin buffer. While this reset impacted near-term results, Janney believes the move has positioned Everest for a healthier balance sheet and more sustainable growth.

Looking forward, Everest is re-underwriting its casualty portfolio while seeking expansion opportunities in property and specialty lines. Janney expects a return to double-digit operating ROE by 2025 and sees current valuation as compelling, with shares trading at just 0.9x book value per share excluding AOCI.

The firm also highlighted Everest’s capital return strategy, noting over 1 million shares repurchased in the past year and a 10 million share buyback program authorized in late 2024. Taken together, Janney views the stock as undervalued relative to performance potential and well-positioned for a rebound.