RNR - RenaissanceRe: A Series Of Preferred Shares Still Offers A 6.1% Yield

2024-05-22 10:30:00 ET

Summary

• RenaissanceRe's book value per share continues to increase, indicating strong financial performance.
• The company's net investment income increased by over 50% in the first quarter, thanks to an expanded investment portfolio.
• RenaissanceRe's preferred shares offer a decent risk/reward ratio, with yields of 6.1% and 5.8% for different series.

Introduction

RenaissanceRe Holdings Ltd. ( RNR ) is a large reinsurance company that is currently ranked 5th in the world based on gross written premiums after completing its acquisition of Validus from American International Group ( AIG ). The company pays a pretty low dividend, which means that the majority of its earnings is retained on the balance sheet, translating in an increasing book value per share. In the previous article, I was focusing on RenaissanceRe’s preferred equity, and with a yield exceeding 6% on one of its preferred share issues, I feel this still represents good value for fixed income seekers....

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