JPM cuts largest Nordic P&C insurers as margin gains slow
BUZZ-JPM cuts largest Nordic P&C insurers as margin gains slow ** In a note on Nordic insurers, J.P. Morgan says that while fundamentals in the region remain healthy, price increases are moderating towards inflation, implying slower underlying margin improvements
** Given the slower margin gains it downgrades the two largest Nordic Property & Casualty (P&C) insurers — it cuts Danish insurer Tryg TRYG.CO to "underweight" from "neutral" and its Finnish peer Sampo SAMPO.HE to "neutral" from "overweight"
** JPM expects Tryg to deliver weak earnings growth, warning that the competitive commercial market will leave the stock as a "show-me" story for re-rating
** The broker retains a relative preference for Finnish peer Sampo due to its stronger earnings growth profile at the same price-to-earnings multiple as Tryg
** However, Sampo's balance sheet is largely optimised and its capital upside is already reflected in consensus buyback assumptions, limiting incremental optionality
(Reporting by Marta Frackowiak)