Topdanmark (Hold, TP: DKK320.00) - Weathering the storm

Despite harsh winter weather, Topdanmark reported Q1 PTP up ~1% YOY due to a strong investment result and solid underwriting. The combined ratio was 84.8%, 1.2%-points higher YOY, supported by low large claims and high run-off gains. While the underlying claims ratio was up YOY, pricing measures should continue to support improved underwriting. On somewhat increased cost control, we have raised our 2025–2026e EPS by ~1%. We reiterate our HOLD and DKK320 target price.

Repricing the tonic for bad weather

We expect above-normal weather-related claims in Q1 as a result of heavy rain and snowfall (and record-low temperatures) in the Nordics at the start of the year. On the positive side, we believe the non-life insurers should see the effects of 2023’s repricing efforts, while their latest CMD presentations leave us confident the sector remains committed to maintaining underwriting discipline. Tryg is our top pick in the Nordic P&C sector, while we also reiterate our BUYs on Sampo and Gjensidige an...

Sampo plc - Mergers & Acquisitions (M&A), Partnerships & Alliances

Summary Marketline's Sampo plc Mergers & Acquisitions (M&A), Partnerships & Alliances and Investments report includes business description, detailed reports on mergers and acquisitions (M&A), divestments, capital raisings, venture capital investments, ownership and partnership transactions undertaken by Sampo plc - Mergers & Acquisitions (M&A), Partnerships & Alliances since January2007. Marketline's Company Mergers & Acquisitions (M&A), Partnerships & Alliances and Investments reports offer a...

Topdanmark (Hold, TP: DKK320.00) - Challenging end to 2023

Topdanmark reported Q4 pre-tax profit of DKK213m, hurt by high weather-related claims following storms and heavy rainfall, and an elevated level of large claims. Despite soft reported figures, the underlying claims ratio improved 0.2%-points YOY, which in our view reflects that the recent repricing efforts are starting to offset increased claims inflation and frequency trends. We have trimmed our EPS by 1–3% for 2024–2025e, reiterating our HOLD and have cut our target price to DKK320 (325).

Underwriting to remain disciplined

We expect heavy rainfall in Denmark and an early winter in the Nordics to lead to somewhat above-normalised claims in Q4, but strong equity markets and marked-to-market gains on bond investments to offset a rise in reported combined ratios. Despite higher interest rates in 2023, we remain confident that insurers will continue to focus on maintaining underwriting discipline. We still find the sector attractive long-term, and highlight Tryg as our top pick in the sector.

Topdanmark (Hold, TP: DKK335.00) - Profitability over growth

Despite severe weather in the quarter, PTP improved by 12% YOY, due to rebounding financial markets. The insurance service result was down by 15% YOY, as the combined ratio deteriorated by 3.2%-points YOY, due to both large and weather-related claims well above normalised levels. The underlying claims ratio increased by 1.8%-points YOY. We have raised our 2024–2025e EPS by ~2% on the back of the underlying improvement. We reiterate our HOLD and target price of DKK335.

Topdanmark (Hold, TP: DKK335.00) - Increasing Motor claims frequency

With several key items pre-announced on 10 July, there were few surprises in the Q2 report. Although the soft insurance service result (down 27% YOY) was due to lower run-offs, the (pre-announced) negative claims frequency trend resulted in the underlying claims ratio deteriorating by 2.4%-points YOY. As the claims trend is expected to continue while prices are being raised, we have reduced our 2024–2025e EPS by 1–4% and our target price to DKK335 (349). We reiterate our HOLD.

Heating up

Q2 has been warm and dry, and although this may support higher claims frequency, there have also been several large claim events in the Nordics QTD. We expect the rational repricing over the past few quarters to continue to bear fruit, supporting underwriting quality and insurance revenue growth. While Q2 investment returns could be hurt by rising rates, the long-term yield outlook has been strengthened. We continue to highlight Sampo and Tryg as our top sector picks.

Sampo plc - Strategy, SWOT and Corporate Finance Report

Summary Sampo plc - Strategy, SWOT and Corporate Finance Report, is a source of comprehensive company data and information. The report covers the company's structure, operation, SWOT analysis, product and service offerings and corporate actions, providing a 360˚ view of the company. Key Highlights Sampo plc (Sampo) is an insurance solutions provider. The company provides a range of property and casualty, and life insurance products and services to its customers. The company offers insurance p...

Northern Lights

Topdanmark (Hold, TP: DKK380.00) - Solid underwriting performance

Q1 PTP was DKK511m, up significantly YOY, driven by higher interest rates, fewer storm-related claims, and a strong investment result. The transition to IFRS17 yielded few surprises. Although the underlying claims ratio was softer YOY, this was partly due to a less inclusive definition of weather-related claims. We have made limited EPS estimate revisions on the back of the solid underwriting performance and an unchanged premium growth outlook. We reiterate our HOLD and DKK380 target price.

Winter without the windy weather

The winter months saw fewer storms than in 2022, and warmer weather than in 2021, although bouts of heavy snow should lead to increased motor claims in Q1, given the return to pre-pandemic driving patterns. While we see solid underwriting with support from investments, the move to IFRS 17 is likely to affect reporting and reduce comparability somewhat, although underlying profitability should be unaffected. We highlight Sampo and Tryg as our top picks among the large Nordic non-life companies.

Topdanmark (Hold, TP: DKK380.00) - Set for payout ratio of above 100%

Topdanmark reported Q4 pre-tax profit of DKK554m, softer YOY as the now completed sale of Topdanmark Liv reduced the investment portfolio and led to some additional costs in the quarter. Management proposed a DKK53.5/share dividend with the proceeds from the sale. Given the current strong solvency ratio and controlled volume growth guidance, we see potential for a payout ratio of above 100% for 2023–2024e. We have made limited 2023–2024e EPS revisions and reiterate our HOLD and DKK380 target pri...

Set for dividends in the after-Life

A cold winter across the Nordics should mean seasonally high claims for the P&C companies, although few major storms indicate normalised weather claims in Q4. With the rebound in financial markets, and the MSCI World index up c9%, earnings are set to receive a long-awaited uplift from equities and higher fixed-income yields. We expect significant capital distributions as Topdanmark issues the proceeds from its Life divestment, and Sampo set to propose a further release of Nordea proceeds. Sampo ...

Northern Lights

Topdanmark - Q3: Higher frequency losses post-pandemic

Q3: Underlying UW weaker amid frequency losses Adj. EPS -3% for ‘22e, -1% for both ‘23e-24e 16% P/E premium to Tryg, even after jumbo DPS – SELL

Topdanmark (Hold, TP: DKK380.00) - Strong dividend outlook

Higher interest rates combined with continued financial market turmoil put a dampener on pre-tax profit through increased investment losses in Q3, although the higher rates supported the combined ratio through increased claims discounting. Topdanmark reported a Q3 combined ratio of 80.1%, flattish YOY adjusting for the sale of Topdanmark Liv (due to close in Q4). We have reduced our 2023–2024e EPS by ~1%, and reiterate our HOLD and DKK380 target price.

Topdanmark - Q3: net profit miss, just soft UW

Q3’22 CR ex run-offs 80.1% vs cons 79.7%, ABG 82.3% Lower ’22 guidance, ‘23 a tad softer than consensus Sh.price reaction: -1-3%; Cons.rev: lower 22e, unchg ‘23e

A sign of things to come

The turmoil in the financial markets continued into Q3, with the MSCI World index falling over 6% QOQ, putting pressure on the Nordic non-life names through soft investment results. As interest rates are continuing to rise, we expect to see a change towards higher yields for the large fixed income investment portfolios. Together with solid underwriting on pro-active repricing, we remain positive on the non-life sector and reiterate our BUY recommendations on Gjensidige, Sampo and Tryg, and our H...

Sector Report - Strong near-term underwriting trends in Q3…

Q3e: Benign underwriting (UW), tougher financials Valuation now undemanding vs. Nordic peers - HOLD