Group 1 - Chubb Limited (NYSE:CB) is considered one of the best large cap value stocks to buy in 2026, with HSBC upgrading its rating to Buy and setting a price target of $354 [1] - Citizens has increased its price target for Chubb to $350 from $325 while maintaining an Outperform rating, anticipating reduced catastrophe losses and minimal mark-to-market effects in Q4 2025 [2] - Mizuho adjusted its price target for Chubb to $317 from $318 while maintaining a Neutral rating, reflecting a slight reduction after updating models across the insurance group [3] Group 2 - Chubb Limited provides a range of insurance and reinsurance products across six segments: North America Commercial P&C Insurance, North America Personal P&C Insurance, North America Agricultural Insurance, Overseas General Insurance, Global Reinsurance, and Life Insurance [4]

Core Insights - Wedgewood Partners anticipates stronger market volatility in the coming years and has moderated its enthusiasm for investments [1] - The Wedgewood Composite returned -1.8% in Q4 2025, underperforming compared to the S&P 500's 2.7%, Russell 1000 Growth Index's 1.1%, and Russell 1000 Value Index's 3.8% [1] - Year-to-date, the Composite gained 4.3%, significantly lower than the indexes' returns of 17.9%, 18.6%, and 15.9% respectively [1] - The underperformance is attributed to poor stock selection, valuation corrections of past strong performers, and being underweight in AI stocks [1] - In 2026, crowded AI investments and stretched valuations are expected to pressure prudent investment decisions [1] Company Focus: Chubb Limited - Wedgewood Partners initiated a new position in Chubb Limited (NYSE:CB), a leading provider in the property and casualty insurance industry [3] - As of January 16, 2026, Chubb Limited's stock closed at $300.77 per share, with a one-month return of -3.27% and a 52-week gain of 11.61% [2] - Chubb Limited has a market capitalization of $119.914 billion [2]

Group 1 - Chubb Limited is a global insurance company providing a wide range of insurance products and operates in 54 countries, making it one of the largest publicly traded property and casualty insurance companies in the world [1] - HSBC set a price target of $354 for Chubb, indicating a potential upside of approximately 18.02% from its current price of $299.96, reflecting confidence in Chubb's market position and growth prospects [2][6] - Chubb's market capitalization is approximately $119.6 billion, with a trading range over the past year between $263.14 and $316.94, indicating some volatility [5][6] Group 2 - Institutional investors are showing interest in Chubb, with Elevate Capital Advisors LLC purchasing 2,913 shares valued at approximately $822,000 during the third quarter [3] - Mitchell and Pahl Private Wealth LLC increased its holdings by 0.5%, now owning 7,381 shares valued at $2.08 million, while Sky Investment Group LLC expanded its stake by 1.6%, holding 2,397 shares worth $694,000 [4] - The current trading volume for Chubb is 540,249 shares, indicating active interest in the stock [5]

Core Viewpoint - Chubb Limited has received a rating upgrade from HSBC, indicating positive sentiment towards the company's future performance in the insurance sector [1][6]. Group 1: Company Overview - Chubb Limited is a global insurance company offering a variety of products, including property and casualty, accident and health, reinsurance, and life insurance [1]. - The company is listed on the NYSE under the symbol CB and has a market capitalization of approximately $119.47 billion, showcasing its significant presence in the insurance industry [5][6]. Group 2: Recent Developments - HSBC upgraded Chubb from a Hold to a Buy rating, with the stock priced at $299.37 at the time of the upgrade [1][6]. - Elevate Capital Advisors LLC purchased 2,913 shares valued at approximately $822,000 during the third quarter, reflecting confidence in Chubb's future performance [2][6]. - Other institutional investors, such as Mitchell and Pahl Private Wealth LLC and Sky Investment Group LLC, have also increased their holdings in Chubb, indicating growing interest among hedge funds and institutional investors [3]. Group 3: Stock Performance - Chubb's current stock price is approximately $299.65, with a slight decrease of about 0.49% or $1.47 [4][6]. - The stock has experienced volatility, trading between a low of $263.14 and a high of $316.94 over the past year [4]. - Today's trading volume for Chubb on the NYSE is 265,650 shares, suggesting active investor interest [5].

Industry Overview - The Zacks Property and Casualty Insurance (P&C) industry is experiencing softer pricing after years of improvement, but is expected to benefit from prudent underwriting, exposure growth, and accelerated digitalization [1] - The industry includes companies providing commercial and personal property insurance, casualty insurance products, and services, with premiums being the primary revenue source [3] - The industry is currently ranked 173 in the Zacks Industry Rank, placing it in the bottom 29% of over 250 Zacks industries, indicating weak prospects in the near term [8][9] Trends and Challenges - Global commercial insurance rates fell by 4% in Q3, marking a decline after seven years of rising rates, with personal auto insurance expected to perform strongly due to improved investment returns and reduced claims [4] - The property and casualty insurance industry is vulnerable to catastrophe events, which can negatively impact underwriting profits, with estimated insured losses from natural catastrophes reaching approximately $107 billion by 2025 [5] - Increased adoption of technology, including blockchain and AI, is transforming the industry, although it also introduces cyber threats [7] Company Insights - **Skyward Specialty Insurance Group, Inc. (SKWD)**: Focuses on complex, underserved risk segments and is well-positioned for growth, with a consensus estimate for 2026 earnings suggesting a 29.4% year-over-year growth [17][18] - **Cincinnati Financial Corporation (CINF)**: Continues to grow through better pricing and strong renewal rates, with a consensus estimate for 2026 earnings indicating a 16.2% year-over-year growth [21][22] - **Hagerty Inc. (HGTY)**: A specialty insurer with a diversified model, expected to achieve 17.6% year-over-year growth in 2026 earnings [24][25] - **Chubb Limited (CB)**: One of the largest P&C insurers, focusing on middle-market businesses and cyber insurance, with a consensus estimate for 2026 earnings suggesting an 8.9% year-over-year growth [27][28] - **The Travelers Companies (TRV)**: A leading writer of auto and homeowners' insurance, expected to see a 6.9% year-over-year increase in 2026 earnings [30][32] Financial Performance - The Property and Casualty Insurance industry has underperformed compared to its sector and the S&P 500, with a collective stock increase of 6.9% versus 16.8% for the sector and 19.8% for the S&P 500 over the past year [10] - The industry is currently trading at a trailing 12-month price-to-book (P/B) ratio of 1.46X, significantly lower than the S&P 500's 8.69X and the sector's 4.23X [13]

Industry Overview - Property and casualty insurance is one of the oldest modern industries and has structurally favorable economics, allowing for quiet compounding [1] Investment Focus - The focus is on identifying potential 5–10 baggers at the small- and mid-cap stage through careful fundamental analysis of businesses, financials, and valuations [1] - The emphasis is on early-commercial-stage life sciences companies, insurers, homebuilders, and select consumer-facing businesses [1]

Industry Overview - The insurance industry is experiencing soft pricing, with global commercial insurance rates declining by 4% in Q3 after seven years of increases [1] - Natural catastrophe losses are expected to reach approximately $107 billion by 2025, primarily due to events like LA wildfires and severe storms in the U.S. [2] - The combined ratio for the insurance sector is projected to improve to 98.5% in 2025, supported by increased exposure and prudent underwriting practices [2] Berkshire Hathaway (BRK.B) - Berkshire Hathaway operates as a diversified conglomerate with over 90 subsidiaries across various industries, with insurance being a key segment contributing about 25% of total revenues [4] - The company benefits from a float-driven model that enhances earnings and provides capital for investments, supported by a strong cash reserve exceeding $100 billion [5][7] - Despite a return on equity (ROE) of 7.3%, which is below the industry average of 8%, Berkshire has shown improvement over time [8] - The Zacks Consensus Estimate for BRK.B's 2026 revenues indicates a 6% year-over-year increase, while EPS is expected to decline by 4.2% [17] Chubb Limited (CB) - Chubb is a leading provider of property and casualty insurance, boasting a diversified business model that enhances earnings stability [11] - The company anticipates an 8.6% increase in EPS by 2026, contrasting with BRK.B's expected decline [10] - Chubb maintains one of the lowest combined ratios in the industry due to disciplined underwriting practices and strategic mergers and acquisitions [14] - The Zacks Consensus Estimate for CB's 2026 revenues suggests a 6.5% year-over-year decrease, while EPS is projected to rise by 8.6% [18] Comparative Analysis - Chubb outperforms Berkshire in terms of ROE and dividend growth, making it a more attractive investment option [10][24] - Berkshire's price-to-book multiple is 1.53, above its five-year median of 1.44, while Chubb's is 1.52, below its median of 1.56 [19] - Chubb has a solid dividend track record, increasing dividends for 32 consecutive years, with a current yield of 1.3%, compared to Berkshire's lack of dividends [23]

Company Performance - Chubb's stock closed at $300.69, down 1.93%, underperforming the S&P 500's daily loss of 0.19% [1] - Over the past month, Chubb's shares have decreased by 1.92%, lagging behind the Finance sector's gain of 1.58% and the S&P 500's gain of 2.26% [1] Upcoming Earnings - Chubb is scheduled to release its earnings on February 3, 2026, with analysts expecting earnings of $6.41 per share, reflecting a year-over-year growth of 6.48% [2] - The consensus estimate for quarterly revenue is $15.28 billion, which represents a 6.95% increase from the previous year [2] Full Year Projections - For the full year, Zacks Consensus Estimates project earnings of $23.75 per share and revenue of $59.86 billion, indicating changes of +5.51% and 0%, respectively, from the prior year [3] Analyst Estimates - Changes in analyst estimates for Chubb are important as they reflect short-term business trends, with positive revisions indicating a favorable outlook on business health and profitability [4] Zacks Rank and Performance - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), currently ranks Chubb at 3 (Hold) [6] - Over the last 30 days, the Zacks Consensus EPS estimate has increased by 0.07% [6] Valuation Metrics - Chubb's Forward P/E ratio is 11.89, which is a premium compared to its industry's Forward P/E of 10.45 [7] - The company's PEG ratio stands at 3.21, while the average PEG ratio for the Insurance - Property and Casualty industry is 2.1 [7] Industry Context - The Insurance - Property and Casualty industry is part of the Finance sector and currently holds a Zacks Industry Rank of 166, placing it in the bottom 33% of over 250 industries [8] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [8]

Core Viewpoint - The transition of leadership at Berkshire Hathaway from Warren Buffett to Greg Abel marks a new era for the company, with Abel committed to maintaining Buffett's investment philosophy of concentrating capital in high-quality ideas [1][2]. Investment Portfolio Overview - Berkshire Hathaway's investment portfolio totals $317 billion, with a significant concentration in eight key stocks that represent 74% ($234.5 billion) of the portfolio [3]. Key Holdings - **Apple**: Represents 20.1% of invested assets; despite being the largest holding, it has seen a 74% reduction in shares over the last two years, indicating a shift in investment strategy [4][6]. - **American Express**: Accounts for 18.2% of invested assets; known for its dual role as a payment facilitator and lender, it has a strong position among affluent customers, making it resilient during economic downturns [7][9]. - **Bank of America**: Comprises 10.2% of invested assets; the position has been reduced by 45% over five quarters, reflecting concerns over interest rate sensitivity amid a rate-easing cycle [11][13]. - **Coca-Cola**: Holds 8.6% of invested assets; its long-standing presence in the portfolio since 1988 is supported by a strong dividend yield and global market presence [14][15]. - **Chevron**: Represents 6.3% of invested assets; its integrated business model allows for stable cash flow, and it has a robust capital-return program with projected buybacks of $10 billion to $20 billion annually through 2030 [16][18]. - **Moody's**: Accounts for 4.1% of invested assets; it has performed well due to its debt rating services and analytics, benefiting from low interest rates in recent years [20][21]. - **Occidental Petroleum**: Comprises 3.4% of invested assets; it has a unique focus on upstream operations and is working to reduce its net debt position [23][25]. - **Chubb**: Represents 3.1% of invested assets; it focuses on high-end property and casualty insurance, allowing for premium pricing power and attractive margins [27][29].

Core Viewpoint - Chubb Limited is set to announce its fourth quarter earnings on February 3, 2026, with a conference call scheduled for February 4, 2026, at 8:30 a.m. Eastern Time [1]. Group 1: Earnings Announcement - The fourth quarter earnings release and financial supplement will be issued after market close on February 3, 2026 [1]. - The earnings conference call will be accessible via live webcast or by phone, with specific dial-in numbers provided for both domestic and international participants [2]. Group 2: Company Overview - Chubb is a leading global insurance provider, operating in 54 countries and territories, offering a wide range of insurance products including property and casualty, personal accident, supplemental health, reinsurance, and life insurance [3]. - The company is recognized for its extensive product offerings, strong financial stability, and global operational capabilities, employing approximately 43,000 people worldwide [3]. - Chubb Limited is publicly traded on the New York Stock Exchange (NYSE: CB) and is part of the S&P 500 index [3].