This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
Trade Parameters
Technical Observations – For
Technical Observations – Against
Attractive 6% dividend yield is amongst the best on the UK Index , the insurance industry business model underpinning shareholder returns. Shares have been rangebound (rising lows, horizontal resistance) in 2018, meaning potential for a revisit of the ceiling. Potential for analysts to turn more bullish.
Risks to Admiral include being more aggressive on terms of price competition in the sector, reducing profitability. More bad weather into year end (like March/April snow) could hurt claims ratios. Any major broker downgrades could hurt the shares, although consensus is already bearish.
Consensus is bearish but analysts’ outlook tend to be for 12-months, whilst this is a short-term trade trade idea. The latest update from Goldman Sachs suggests upside to 1965p. The breakout, extending the uptrend, could encourage brokers to upgrade both ratings and targets.
Next Event: First half results, 15 Aug
Latest Broker 12-Month Consensus: 15% Buy, 35% Hold, 50% Sell (full breakdown on request)
Source: DowJones Newswires, Reuters News, Bloomberg or Company Press releases
| Share | 1wk | 1m | 3m | 6m | 1yr | 2yr | 3yr | 4yr | 5yr |
| Perf % | 1.5 | 0.8 | 1.9 | 1.4 | -3.7 | -3.6 | 34.8 | 25.2 | 43.4 |
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Prepared by Michael van Dulken, Head of Research