W. R. Berkley downgraded to Sell from Hold at Deutsche Bank
Deutsche Bank analyst Joshua Shanker last night downgraded W. R. Berkley to Sell from Hold while raising his price target for the shares to $55 from $53. Investors are mistaking the appreciation in Property and Casualty insurance stocks as the "fruit of renewal rate pricing increases in the P&C market," Shanker tells investors in a research note. The analyst agrees that some lines of insurance have seen price increases, but broadly he believes the lines of business where it has occurred are those that are experiencing the most-material erosions in underwriting margin. He expects P&C insurers will see consensus earnings forecasts trimmed on a lower interest-rate outlook with "increased pricing merely offsetting higher losses."