UBS upgraded Admiral on Tuesday to \u2018buy\u2019 from \u2018neutral\u2019 and lifted the price target to 3,550p from 3,300p.<\/p>\n
UBS estimated that the UK motor insurance market has a high probability of pricing in excess of inflation over the coming six months. “While industry data points suggest pricing is currently around inflationary trend, Admiral has raised prices year-to-date in excess,” UBS said.<\/p>\n
“Four drivers that cause us to be more optimistic are: 1. Admiral’s year-to-date action, 2. peer commentary at full-year results, 3. Monthly CPI data and 4. EY industry forecast margins.”<\/p>\n
UBS noted that Admiral’s price-to-earnings multiple has a strong positive correlation with UK motor insurance pricing and said it expects this to continue.<\/p>\n
“We are only forecasting for a minor period of price in excess of inflation for Admiral in 2026, and each 1ppt is worth circa 4% to forward EPS.”<\/p>\n
UBS also said the company\u2019s 2025 result was a landmark. It noted that aggregate profits from UK Home, Travel & Pet, Europe and Admiral Money were close to \u00a3100mn, and these are now expected to more than double by 2028.<\/p>\n
“This should lead to a group share of profit of circa 15%, and likely to grow still,” it said.<\/p>\n
UBS said that profit emergence from beyond UK motor insurance has long been the aspiration, but now management have confidence in guidance.<\/p>\n
“This now totals 12% of our valuation,” the bank said. “In addition, the Internal Solvency model details should provide a one-off catalyst over the next 12 months which we estimate could result in an additional 1.5- 3.0% of market cap being distributed to shareholders, not in our forecasts.”<\/p>\n
At 1105 GMT, the shares were up 3% at 3,214p.<\/p>\n","protected":false},"excerpt":{"rendered":"UBS upgraded Admiral on Tuesday to \u2018buy\u2019 from \u2018neutral\u2019 and lifted the price target to 3,550p from 3,300p.…\n","protected":false},"author":2,"featured_media":28971,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[129],"tags":[8210,17561,1971,8212,1976,1972,2945,2220,8211,223,8209],"class_list":{"0":"post-28970","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-ubs","8":"tag-8216buy8217","9":"tag-admiral","10":"tag-categoryall","11":"tag-categorybroker-recommendations","12":"tag-categorymarket-pulse","13":"tag-categorymarket-report","14":"tag-categorysectorial-finance","15":"tag-shares","16":"tag-spark","17":"tag-ubs","18":"tag-upgrades"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ch\/116204757606343067","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/28970","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/comments?post=28970"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/28970\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media\/28971"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media?parent=28970"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/categories?post=28970"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/tags?post=28970"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}