LONDON (ShareCast) - (Sharecast News) - Analysts at Berenberg raised their target price on insurer Hiscox from 1,015.0p to 1,285.0p on Thursday, citing a "strong finish to a turbulent year".
Berenberg said Hiscox had a strong end to the year, with the group posting a combined ratio of 90.6% - boosted by $239.0m of reserve releases, which helped drive a 25% increase in underwriting income of roughly $270.0m year-on-year.

The German bank stated this was "a strong result" considering 2022 was "a volatile year", with Hiscox absorbing approximately $183.0m of large loses.

Looking ahead, Berenberg said the outlook remains "very attractive", not only for Hiscox, but for all London Market peers, as rate momentum across property and speciality reinsurance lines was expected to persist, while underwriting conditions were said to perhaps be the best in decades.

"We reduce our group FY 2023-24E GWP and NWP forecasts by 4.9-4.7% and 1.6-2.2% respectively due lower growth in retail. We improve our group FY 2023-24E combined ratio forecasts by 1ppt and 0.5ppt, respectively, due to the better expected profitability across the big ticket lines," said Berenberg, which reiterated its 'hold' rating on the stock.

"We raise our investment income estimates due to the higher yields. All in all, our pre-tax profit estimates for FY 2023-24E increase by 3.6-3.4%. We roll forward our estimates one year and raise our price target to 1,285.0p."







Reporting by Iain Gilbert at Sharecast.com

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