Tryg (Buy, TP: DKK194.00) - More to harvest from new business
Synergies and continued strong repricing helped boost the technical result in Q3, and strengthened the underlying claims ratio by 80bp YOY to 68.1%. However, earnings were softer than expected, as the ongoing turbulence in financial markets led to losses on Tryg’s investment portfolio. With the DKK5bn buyback programme well underway, and a Solvency ratio of 198%, the outlook for distributions remains strong, and we reiterate our BUY and DKK194 target price. At a 2024e P/E of c15x, we find the stock attractively valued.Tryg is an insurance company, engaged in providing insurance services. Co.'s private segment encompasses the sale of insurance products to private individuals in Denmark and Norway. Co.'s commercial segment encompasses the sale of insurance products to small and medium-sized businesses in Denmark and Norway. Co.'s corporate segment sells insurance products to corporate customers under the brand Tryg in Denmark and Norway, Moderna in Sweden and Tryg Garanti. Co.'s Sweden segment comprises the sale of insurance products to private customers under the Moderna brand. Moreover, insurance is sold under the brands Atlantica, Bilsport & MC, Securator and Moderna Djurforsakringar.
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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