FRANKFURT (dpa-AFX) – Investors were satisfied on Monday with the upwardly revised profit outlook for Hannover Re. In a general positive market and sector context, the reinsurer’s securities were among the biggest winners on the Dax in the morning, with an increase of 3.5%. They thus recovered from their lowest level since mid-August, which they reached last Friday. Since the record of 265.60 euros reached in mid-October, the stock has lost up to 11%.
Stocks were in good company with Monday’s rise, as prices of other reinsurers also rose. While the shares of sector leader Munich Re rose by 1.8%, those of Swiss Re recorded an increase of around 4%, a rise similar to that of the shares of the Hanoverian group. The driving force behind the Swiss action was the turnaround of the major bank UBS, which transformed its sell opinion into a buy opinion. Analyst Will Hardcastle removed from his evaluation model the risk reduction taken into account after Swiss Re created a provision of several billion for claims in the United States.
Hannover Re’s quarterly report and goal statements were well received. The world’s third-largest reinsurer expects profits to rise this year despite catastrophic weather. As expert Derald Goh of the Canadian bank RBC wrote, the profit target of 2.3 billion euros for this year is in line with the average expectations of analysts.
According to DZ Bank expert Thorsten Wenzel, the reinsurer presented a “solid result” for the third quarter, under the influence of certain exceptional effects. “The operating result certainly remained slightly below forecast, but this is due to a relatively weak investment result. The effect on profit is more than offset by a low tax rate,” writes the expert. According to him, this contributed to the board of directors raising its outlook for 2024, despite the recent accumulation of major losses.
Regarding the new target published for the 2025 financial year, Mr Goh wrote that at €2.4 billion, it was slightly lower than generally expected. But he also stressed that Hannover Re shareholders were accustomed to conservative forecasts.
Last Friday, the surprise announcement of a change of director temporarily caused the stock to fall to its lowest level in three months. Thus, the chairman of the management board Jean-Jacques Henchoz will hand over the management of the group to the current financial director Clemens Jungsthofel as of April 1, 2025./tih/stw/mis
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