GS shifts view on life insurers; ups L&G, cuts NN on capital return scope

NN

05/12/2024 09:50

** Goldman Sachs upgrades British insurer L&G  LGEN.L  to
"buy" from "hold" and downgrades its Dutch peer NN Group to
"hold" from "buy"
    ** L&G is writing its UK BPA business at a "historically
lower strain", while considering buybacks to shareholders, which
GS says would "fundamentally" change its capital return profile
    ** GS raises L&G's buyback expectations for 2025, seeing
them at GBP 1.1 billion ($1.4 billion) vs. Visible Alpha
consensus of GBP 0.7 billion
    ** Although NN offers around 11% in total return yield for
2025, GS warns that its recent performance issues in the
Netherlands Life segment limit its capital return potential
    ** "NN faces challenges with further upside risks off the
table for now," it says, though it still expects the group to
announce a buyback worth around 300 million euros ($316 million)
    ** Ten out of 17 analysts rate L&G "strong buy"/"buy", with
six at "hold" and one at "sell" 
    ** Ten out of 18 analysts rate NN Group "strong buy"/"buy",
with eight at "hold" 
    
($1 = 0.7859 pounds)
($1 = 0.9496 euros)

 (Reporting by Hugo Lhomedet)
 ((hugo.lhomedet@thomsonreuters.com))