Brit shares suffered a drop in price following the release of its third quarter trading update this week – even though analysts were happy with the company’s reassurances over sub-prime exposure and falling rates.
Chief executive Dane Douetil said he expected rates to improve “in the next 12 months”, and the company confirmed it would meet year-end forecasts.
However, the stock market took a different view, with shares initially falling by just over 2% before recovering to 261p by the end of the day.
The slump occurred despite Citi reiterating a ‘hold’ and Numis a ‘buy’ recommendation, although Citi reduced
its target price to 285p from 360p, and Numis to 390p from 400p.
Valued at 365p at the start of November, Brit shares stood at 259p as Insurance Times went to press.
There was better news for Beazley, as the lingering concerns over its exposure to US sub-prime professional liability claims were assuaged somewhat by Credit Suisse.
It upgraded the com-pany from ‘neutral’ to ‘outperform’ and planted a 220p target price on the stock.
Beazley has also joined a growing list of companies entering into a share buy-back scheme, from which it expects to repurchase £30m of stock.
Beazley’s share price was 158p as Insurance Times went to press, down from 170p at the start of November