BofA upgrades Gjensidige to 'buy' on margin recovery

Gjensidige Forsikring ASA

03/04/2024 12:01

** BofA Global Research upgrades Gjensidige Forsikring
 GJFG.OL  to "buy" from "neutral", as it says share price
already captures likely lower Q1 results of the Norwegian
insurer, while the broker sees margin recovery ahead
    ** "Shares have more than priced for near-term
disappointment, without any credit or appreciation for margin
recovery to come," the broker says, noting Gjensidige's shares
being more than 16% lower year to date
    ** BofA expects the company's quarterly insurance service
result from general insurance to fall by 36% YoY, but profit
before tax to rise by 13%, due to positive impact on liabilities
from higher interest rates
    ** Higher pricing should improve Gjensidige's revenue in the
coming quarters and a fast margin recovery, the broker says,
making for an "attractive" entry point
    ** Out of 16 analysts covering Gjensidige, six rate the
stock "buy" or "strong buy", six rate it "hold" and four rate it
"sell" or "strong sell"

 (Reporting by Anna Chaberska)
 ((Anna.chaberska@thomsonreuters.com))