Topdanmark (Hold, TP: DKK390.00) - Strong Q4e set to support dividends
On the back of today’s positive profit warning, we expect a strong end to 2021 for Topdanmark, and forecast Q4 EPS of DKK6.7, supported by high investment returns and a solid 80.3% combined ratio. We have raised our 2022–2023e EPS by ~1% and lifted our 2021e DPS to DKK32 (30). In turn, we have increased our target price to DKK390 (380). That said, at a 2022e P/E of ~21.7x, we still find the valuation fair and reiterate our HOLD.Topdanmark A/S is a Denmark-based insurance company engaged in the insurance and pension fund business. The Company's activities are divided into such segments, as Personal, and SME (Small and Medium Enterprises) and Industrial. The Personal segment sells policies for individual households in Denmark. The SME and Industrial segment offers policies for Denmark-based SME, agricultural and industrial businesses. The Company's private insurance offering includes such insurance products, as home, vehicle, accident, pet, child and life and health insurance, as well as pension funds. Its corporate insurance offering includes property insurance, insurance of goods and equipment, and car insurance, among others. As of December 31, 2012, it had subsidiaries responsible for life and non-life insurance, as well as for asset management, investment and property-related activities.
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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