This Dividend Aristocrat Still Offers Nice Value in the Insurance Space

Chubb Ltd. (NYSE:CB) is the largest publicly traded property and casualty insurance company in the world. Shares of Chubb have climbed 18.7% in 2019 as of close on November 22. The stock has achieved average annual returns of 13% over the past 10 years. Its case is strengthened by its history of dividend growth.

Over the past few months, I’d covered some of my favourite dividend aristocrats on the S&P 500. That is, stocks that have delivered at least 25 consecutive years of dividend growth. Chubb entered that club in this decade.

The company released its third-quarter 2019 results on October 29. Net income fell 11.4% year-over-year to $1.1 billion.

However, core operating income rose 10.2% from the prior year to $1.2 billion. Its net profit was negatively impacted by mark-to-market losses of $119 million. This was primarily related to its variable annuity reinsurance portfolio.

All in all, Chubb put together a strong quarter. P&C net premiums written rose 7.2% in constant dollars to $8 billion and P&C underwriting income increased 12.6% to $754 million.

Adjusted investment income climbed 3.1% to $910 million. The stock last boasted a price-to-earnings ratio of 19 and a price-to-book value of 1.2, both in solid value territory.

Chubb announced a quarterly dividend of $0.75 per share. This represents a 2% dividend yield. The company has delivered dividend-growth for 26 consecutive years.

Investors in Chubb can snag a strong stock that has achieved good capital growth over the past decade and is an established dividend payer.