This AXIS Capital analyst adopts a bearish outlook, forecasting a 'tougher' two-year period ahead

AXIS Capital Holdings Faces Challenging Outlook After Strong Performance

AXIS Capital Holdings Ltd (NYSE: AXS) has seen its stock value rise over the past two years, thanks to a refreshed strategy and new leadership. However, Bank of America Securities warns that the coming years may present greater challenges for the company.

Analyst Update: Joshua Shanker, an analyst at Bank of America Securities, has revised his rating for AXIS Capital Holdings from Buy to Neutral and slightly reduced the price target from $116 to $115.

Recent Performance and Analyst Perspective

Shanker noted that AXIS Capital enjoyed an impressive two-year run, driven by strategic hires and a renewed focus that resulted in solid returns. Despite this, he cautions that the environment is shifting, with pricing trends expected to become less favorable for the sector in the near future.

Looking ahead, Shanker anticipates that AXIS Capital will encounter more difficult market conditions, with pricing no longer supporting the industry as it has previously.

Transparency and Financial Health Concerns

The analyst also pointed out that the company’s underwriting process may become less clear as managing general agent (MGA) risk and contract-binding business make up a larger share of its portfolio. Additionally, AXIS Capital’s balance sheet now shows signs of worsening loss trends, similar to those seen in its industry peers. Shanker’s earnings projections for 2026 and 2027 fall below consensus estimates, citing increased acquisition expenses and less favorable reserve developments as key factors.

Stock Movement: At the time of reporting on Tuesday, AXIS Capital Holdings shares had dropped 3.1% to $102.24.

Further Reading

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AXIS Capital Holdings Snapshot

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