Michael Faulkner looks at the motor insurers
In a slow week on the stockmarket, Admiral was the star performer among both insurance stocks and the FTSE 100.
The motor insurer saw its share price rise over 9% this week, making it the second highest riser among the top 100 UK-listed companies.
Investment bank Numis upgraded its recommendation from ‘add’ to ‘buy’, highlighting, among other things, Admiral’s growth potential from its aggregator Confused.com and its European operations. The downside was that the fiendishly competitive motor market could dampen growth.
Admiral, which has seen its share price soar by nearly 25% over the past six months, was trading at 1,011p as Insurance Times went to press.
Chaucer was also upgraded by Numis from ‘hold’ to ‘add’. Numis pointed to its motor book as providing balance against the impact of softening commercial lines rates. Chaucer’s third party syndicate management business was also cited as positive.
But Numis said Chaucer’s growth strategy was not clearly defined and that exposure to the UK motor market could be a drag on earnings.
As Insurance Times went to press Chaucer was trading at 98.25p, up 1.03% for the week.
In contrast to the fortunes of Admiral, motor specialist Highway was one of the biggest fallers this week, its share price dropped nearly 5%.
Over the past six months, the company has seen its share price rise by 8%, outperforming the FTSE 100 which has slumped by around 1.5%.
AIM-listed Lloyd’s insurer Omega saw its stock slump this week, down 2.05% over the last seven days to 167p.
The insurer received a sharp boost in its share price last week after it announced it was in talks with potential bidders.
Omega has seen its share price rise over 17% in the past six months.
Other fallers this week included Catlin (down 2.59%), Hiscox (down 1.44%) and Novae (down 2.14%).
Risers of the week included Royal & SunAlliance (up 0.54%) and Aviva (up 0.69%). Lancashire, which reported soaring full year pre-tax profits this week rose 1.99%.