Mercury General Corporation (MCY) Could Go Either Way

Investors will get their next glimpse of MCY’s Q1 earnings on May 06. Analysts are forecasting revenue to climb 5.7 percent to $906M in the next fiscal quarter, while earnings are seen soaring by nearly 950 percent to $0.21 per share. History has shown that shares in Mercury General Corporation have gone down on 21 different earnings reaction days and are predicted to add 0.04 percent when the company reports upcoming earnings. In last reported earnings results, it earned $1.11 per share, better than the $0.73, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $817M, worse than the $906M analysts expected. Earnings are estimated to increase by 82.6 percent this year, 64.12 percent next year and continue to increase by 37.9 percent annually for the next 5 years.

Mercury General Corporation (MCY) will probably climb 11.23 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $66 price as 12-month high target. This represents a whopping 21.35 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $57.5, which represents a return potential of 5.72 percent when compared to the closing price of the stock of $54.39 on Wednesday, February 13. The lowest price target for the stock is $49 — slightly more than -9.91 percent from MCY’s current share price.

The stock is currently hovering around the first support level of $51.88. Below this, the next support is placed in the zone of $49.36. Till the time, the MCY stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 56.86 on daily chart, which may remain a cause for concern. If the price breaks below $49.36 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $55.73 mark may result into a pull-back move towards $57.06 level.

On 13th of February, Mercury General Corporation (NYSE:MCY) shares ended higher after a volatile session. The shares accumulated 3.5 points or 6.88 percent at $54.39 with a light trade volume of 1.155 million shares. After opening the session at $50.88, the shares went as high as $54.55 and as low as $50.7, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $3.01 billion and now has 55.28 million shares outstanding. Mercury General Corporation (MCY) stock has gained 4.58 percent of market value in 21 trading days.

MCY stock has a trailing 3-year beta of 0.28, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $1.53 a share in the trailing twelve months. The stock’s value has surged 5.18 percent year to date (YTD) against a rise of 25.41 percent in 12 month’s time. The company’s shares still trade -12.03 percent away from its 1-year high of $61.83 and 28.16 percent up from 52-week low of $42.44. The average consensus rating on the company is 0, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a buy.

Shares of Mercury General Corporation (MCY) are trading at a P/E ratio of 0 times earnings reported for the past 12 months. The industry MCY operates in has an average P/E of 12.94. Its P/E ratio went as low as 17.52X and as high as 45.59 over the 5-year span. Further, it is sporting a 0.88 on the Price-to-Sales ratio. Compare this with the industry average P/S of 0.68. 0 percent is the gross profit margin for Mercury General Corporation and operating margin sits at 3.2 percent. Along with this, the net profit margin is 2.8 percent.

Let’s take a look at some insider activity at Mercury General Corporation (NYSE:MCY) and see the pattern. The earliest insider trade took place on 11/06/2018. Curtius Mike parted with a total of 0.4 thousand shares of company at average share price of $60.95. The total for the sales was set at $24.38 thousand. After this transaction, the Director account balance stood at 20.43 thousand shares. The stock lost -16.51 percent since that insider sale. On 02/08/2018, Little Joshua Eric, Director, purchased 0.5 thousand shares at a price per share of $42.68. This added 21.34 thousand shares to the insider’s fortune and the stock saw a 19.24 percent rally in value since the news became public. This transaction left 0.5 thousand shares in the Director account.

On 08/04/2017, CEO/President Tirador Gabriel performed a sale transaction worth $138.95 thousand. This sale at $59 each has eliminated 2.36 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -13.75 percent decrease since the transaction was reported. The insider now is left with 40.23 thousand shares remaining in the account. Tirador Gabriel, who performs the CEO/President job, sold 2.36 thousand shares for $138.95 thousand. The disposal occurred on 08/04/2017 was priced at $59 per share. The share price plunged -13.75 percent since the reporting date. Tirador Gabriel now left with a stake of 37.87 thousand MCY stock worth $2.06 million after the insider selling.