The Insurance Australia Group Ltd (ASX: IAG) share price is in the green today, up 0.71% to $5 per share at the time of writing.
The insurance stock has trounced the benchmark index in 2022 so far.
The IAG share price is up 12% in the year to date while the S&P/ASX 200 Index (ASX: XJO) is down 8%. IAG shares are also outperforming the S&P/ASX 200 Financials Index (ASX: XFJ), which is down 3%.
The IAG share price hit a new 52-week high last week of $5.09, as my Fool colleague Matthew reported.
So, is it too late to buy?
Broker tips earnings upgrade
The latest tailwind for the IAG share price is an earnings upgrade from top broker Morgan Stanley.
According to reporting in The Australian, Morgan Stanley has upgraded its earnings expectations for IAG on the back of higher investment yields and continual price increases.
Morgan Stanley analyst Andrei Stadnik expects IAG to lift its cash net profit by 3% to 5%.
Insurance shares tend to ride out periods of rising inflation fairly well. This is because insurers can raise their prices to offset rising costs reasonably easily as consumers tend to still want their products, even when they are tightening their belts.
Experts say buy on the IAG share price
As my Fool colleague Zach reported recently, several brokers are positive about the IAG share price.
Wilsons' analysts recently singled out IAG as a quality ASX share pick for income investors due to its strong dividend yield, earnings quality, and long-term outlook.
Wilsons said that on 26 October, when the IAG share price closed at $4.82.
Zach pointed out that IAG is offering a 5.35% projected dividend yield for the next 12 months.
Watermark Fund Management principal Justin Braitling says insurance shares are looking increasingly attractive due to rising interest rates and depressed company valuations.
Braitling said:
Insurance margins have been under pressure with low interest rates (now reversing) and the insurance cycle has turned following a period of elevated claims.
The shares are cheap, and we are moving into a hardening cycle for premiums-claims inflation on the other hand should start to ease.
