BofA Upgrades Hartford Financial Services, Even After Recent Upturn

Hartford Financial Services Group Inc’s HIG fundamentals are sufficiently strong to support potential upside, according to BofA Securities, especially with better-than-expected growth in commercial property and casualty insurance in the second quarter and higher-than-projected margins in the Group Benefits segment.

The Hartford Financial Services Analyst: Joshua Shanker upgraded the rating for Hartford Financial Services from Neutral to Buy, while raising the price target by $1 to $76.

The Hartford Financial Services Thesis: The company’s shares have lost 6% since Chubb Ltd CB announced its decision to not pursue to acquire Hartford Financial Services on April 22, Shanker said in the upgrade note.

“The company has also amped up its repurchase effort during the past quarter with $568mn repurchased in 2Q21, $160mn QTD and $1.7B remaining in the currently authorization. We would expect strong repurchasing efforts to continue at the current stock price,” the analyst wrote.

The shares have 21% upside and Hartford Financial Services offers a dividend yield above 2%, which make the stock “among the more attractive risk/return opportunities in our coverage universe,” he added.

HIG Price Action: Shares of Hartford Financial Services had risen by 0.60% to $63.62 at the time of publication Friday.