BMO Lifts Chubb (CB) Target After Q4, Flags Reserve and Investment Income Tailwinds

Chubb Limited (NYSE:CB) is included among the 13 Cheapest Dividend Aristocrats to Invest in.

On February 10, BMO Capital’s Michael Zaremski revisited his outlook on Chubb Limited (NYSE:CB) following the company’s Q4 results, raising his price recommendation to $326 from $286. The analyst reiterated a Market Perform rating on the stock. While broader consensus expects margin expansion to level off from here, Zaremski suggested there may still be room for incremental EPS upside. In his view, reserve releases and stronger investment income could provide an added boost, even if core margin gains begin to slow.

During Chubb’s fourth-quarter earnings call, Chairman and CEO Evan Greenberg described the period as a strong finish to what he called a record year. He framed the results as proof of the company’s diversified business model, noting that performance strength was not isolated to one or two units. Most operating segments, he said, contributed meaningfully.

Core operating income reached nearly $3 billion, or $7.52 per share. That marked gains of roughly 22% and 25% from the prior year. Greenberg also pointed to a combined ratio of 81.2%, the lowest in the company’s history, reflecting disciplined underwriting and solid profitability. Growth in the fourth quarter outpaced the company’s average pace for the year. The agriculture segment stood out in particular. Chubb remains the largest crop insurer in the United States, and that business delivered strong momentum.

The investment portfolio also expanded. Invested assets climbed to $169 billion, up from $151 billion a year earlier, giving the company additional earnings power through investment income. For the full year, Chubb generated operating income of just under $10 billion, or $24.79 per share. That represented increases of about 9% and 11%, respectively.

Premium growth remained healthy. Property and casualty premiums rose more than 7.5% in the quarter. Consumer lines grew close to 12%, while commercial lines advanced more than 6%. International P&C operations posted nearly 11% growth, and the U.S. agriculture business surged more than 45%, standing out as one of the strongest contributors.

Chubb Limited (NYSE:CB), headquartered in Switzerland, operates as a global insurance and reinsurance provider. Through its subsidiaries, it offers commercial and consumer insurance products, along with risk management, loss control, engineering support, and complex claims services to clients worldwide.

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