Courtesy / NYSE
Trading at the New York Stock Exchange (NYSE) opened Monday with the traditional bell rung by San Antonio’s Mark Watson III, president and CEO of Argo Group International Holdings, a specialty insurance underwriter with offices downtown and around the world.
Bermuda-based Argo Group, which has its U.S. headquarters in San Antonio, announced April 23 that it was transferring the listing of its shares to the NYSE from the NASDAQ Global Select Market. On Monday, Argo’s ticker symbol changed from AGII to ARGO.
On Wall Street, banners celebrating Argo hung outside, and a Formula E car was on display, highlighting Argo’s sponsorship of the Dragon Racing team in the global all-electric motorsport series.
“We are confident that by joining one of the world’s most prestigious trading platforms, we can reach a broader base of global investors and build even greater shareholder value,” Watson stated.
On Tuesday, Argo stock was up $3 at the opening bell, and the company's board of directors declared a quarterly cash dividend of $0.27 per share on the company's common stock.
Argo’s Gary Grose, a producer management leader who manages client relationships from his office in Chicago, said he can’t recall a $3 price jump in Argo shares anytime recently. “It’s certainly a nice ride early on,” he said.
The stock closed at $61.55, up $1.31.
The process to transfer to the NYSE began last year. “Most of it has to do with the evolution of us as a company – many of our top-line competitors are in the NYSE, and also we felt that by moving to the NYSE, we’d have a market maker that helps us market our stock and get in front of the right investors,” Grose said.
Argo joins a handful of San Antonio-based companies that are listed on the NYSE, including Cullen/Frost Bankers, NuStar Energy, Valero Energy, Andeavor, Lilis Energy, Harte Hanks, and Biglari Holdings.
The NYSE is the only exchange that offers "designated market makers," firms that determine the appropriate opening auction price when a company begins trading as a publicly listed company.
"We felt it was the right timing for where we want to go,” Grose said. “By joining what we believe is the world’s most prestigious trading platform, we’d reach a broader base of global investors and, by that, the goal is building even greater shareholder value.”
Argo turns 70 this year, and the company marked that milestone not only with a new ticker symbol but a favorable first quarter, when gross written premiums and net investment income went up, following heavy industry-wide claims losses during 2017. Argo paid out $127 million in claims last year following a spate of natural disasters, including major hurricanes, flooding, earthquakes, and wildfires.
"The key for a business in our situation is you don't want to stand out from the crowd," Grose said. "You want to have the underwriting expertise to know that we can make the [claims] payment because that's the business we're in."
Argo reported $8.76 billion in assets for 2017, a 21.5 percent increase over the previous year. At the end of 2016, the company expanded its global footprint by acquiring Ariel Re, a global underwriter of insurance and re-insurance business, and in March of this year, Argo announced it had purchased Italian specialty insurer Ariscom.
Grose said Argo’s strategy of global growth is bearing fruit, balancing out the "hills and valleys" of financial stability in years past, and expanding its access to potential clients in strong growth markets.
“The international position is really starting to have an impact on our bottom-line results," he said. "We believed that if we could get international [business] moving, and we have, that that really lent itself to a broader and more diverse base of our underwriting. Because when a hurricane hits the U.S., it has a big effect on U.S. underwriting results. When that happens, that’s the business we’re in.
“But if we’re growing strong and have good underwriting results in the rest of Europe and Asia, you’re going to settle out those results as they come through.”
Founded in 1948 as Argonaut Insurance Exchange, Argo now operates from a number of offices in the U.S., as well as London, Singapore, Dubai, Brazil, and several European cities, and has 1,400 total employees.
About 200 work from Argo’s San Antonio offices, located at the IBC Centre at 175 E. Houston St., in the heart of the downtown tech corridor.
That count has remained steady in recent years, Grose said, as part of Argo’s hiring strategy is to seek out people with greater levels of expertise – underwriters who can work on business development, for instance. The company also invests aggressively in digital innovation.
“It’s about making our customers’ lives easier, to deal with us rather than our competitors,” Grose said. “Access time has been shortened, underwriting time has been shortened. And we continue to evolve and use technology to great effect because we think that is the key.”