tisdag 4 mars 2014
Nordea startar upp bevakning av Protector Försäkring
Nordea startar bevakning av Protector. Analysen ser ni nedan (saknar länk). Kul att analytikerna vaknar! :)
Fantastic growth won't stop here
Norwegian non-life insurer Protector Forsikring has delivered an
impressive 44% CAGR in Commercial/Public gross premiums and 20%
CAGR in total premiums over the past eight years. Meanwhile, average
adjusted return equity has been like a cash machine at 24%. In 2013,
premiums in Sweden/Denmark were up 174% y/y. Growth will continue
there, given the key cost advantage of the broker distribution model.
The valuation is attractive, highlighted by a 2016E P/E of 6.8x and a
7% yield. We initiate coverage with a Buy and NOK 35 target price.
Stable cash cow in Norway
Protector's value proposition in the commercial markets is to be the topquality
challenger to the established insurance companies with distribution
solely through brokers. After its growth over ten years from nothing to
NOK 1.6bn in gross premiums in Norway, including change-of-ownership
insurance, we now factor in a stable 13.5% broker market share.
Further growth to come in Sweden and Denmark
We expect a further 76% and 51% growth in premiums for 2014 and 2015
in Sweden/Denmark. In our base case, we forecast that the broker market
share in 2018 will increase to 9.5% in Sweden and 4.5% in Denmark. Our
bull case, with even greater replication of the Norwegian success, assumes
a faster market share increase and somewhat higher end market shares.
Attractive earnings growth ahead
Our base case estimates that Protector's gross premiums see a 2013-16E
CAGR of 14% and a corresponding underwriting result CAGR of 7%, as
the combined ratio will normalise. In our bull case, premiums grow by a
corresponding 17% and the underwriting result by 12%, translating into
adjusted 2016E EPS of NOK 4.8.
Discounted dividend model shows upside
Our base-case fair value is NOK 34.6 per share, while our bull case yields
NOK 38.3 (with all profit retained in 2015E to support growth). Our
probability-weighed target price also includes a negative scenario.