Storebrand (Buy, TP: NOK70.00) - Time is on your side
We forecast Q2 operating profit around normalised levels, but a solid adj. EPS of NOK1.6 thanks to narrowing credit spreads and strong equity markets. While hopes of near-term extraordinary dividends have faded, we expect Storebrand’s Solvency II ratio to again prove rather robust, declining only 3%-points QOQ. We have raised our EPS estimates due to AUM tailwinds, but trimmed our 2021e adj. EPS by ~2% to reflect the earlier implementation of pension accounts in Norway than previously factored in. We reiterate our BUY and NOK70 target price.Storebrand ASA is the parent company in a financial group. Co. is a provider of pension savings. Co. provides range of products within life insurance, property and casualty insurance, asset management and banking, to companies, public sector entities and private individuals. Co.'s corporate organization includes the business areas of Savings, which comprises of non-guaranteed Defined Contribution in Norway and Sweden, Asset Management and Bank products to the retail market; Insurance, which includes Co.'s risk products; Guaranteed Pensions, which includes long-term pension savings products that give customers a guaranteed rate of return; and Other.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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