ProAssurance Corporation PRA announced that its board of directors paused its quarterly dividends. Due to the recent trading price of its stocks, the company suspended the program. It now plans to focus on share buybacks to return capital to stockholders.
Now let’s take a closer look at its share price performance. Over the last ten-year period, PRA shares have declined 75.9% against the industry’s surge of 132.1%. In the past year alone, the company’s shares have fallen 46.1% while the industry average declined 1.3%.
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ProAssurance paid a cash dividend of 5 cents per share in the first quarter of 2023. Its dividend yield of 1.7% was significantly higher than the industry average of 0.4%. The last time it changed its dividend structure was in 2020 when it reduced the payout from 31 cents per share to 5 cents.
How are the company’s financials standing?
PRA exited the first quarter with cash and cash equivalents of $56.4 million, which soared from the 2022-end level of $30 million. Debt-less unamortized debt issuance costs came in at $427.5 million, up 0.1% from the 2022-end figure. Its total debt-to-total capital of 27.3% remains above the industry’s average of 19.7%.
In the March quarter of 2023, PRA’s net cash used in operating activities amounted to $29.8 million. On the flipside, the company generated cash flows of $14.3 million in the year-ago period. Over the trailing 12-month period, its net operating cash flow deteriorated 147.8%.
With the suspension of the quarterly dividends, PRA plans to focus on its existing share buyback program, which had $106.4 million left at the first quarter end. It did not buy back common shares in the first quarter.
Zacks Rank & Stocks to Consider
ProAssurance currently has a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks in the broader finance space are Ambac Financial Group, Inc. AMBC, Lemonade, Inc. LMND and Argo Blockchain plc ARBK, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Ambac Financial’s 2023 earnings has improved 68% over the past 30 days. During this time, AMBC has witnessed one upward estimate revision against none in the opposite direction.
The Zacks Consensus Estimate for Lemonade’s 2023 earnings suggests 15.9% year-over-year growth. Also, the consensus mark for LMND’s 2023 revenues implies a 53.6% year-over-year rise.
The Zacks Consensus Estimate for Argo Blockchain’s 2023 bottom line suggests an 87.8% year-over-year improvement. During the past month, ARBK witnessed two upward estimate revisions against none in the opposite direction.
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