Jefferies upgraded Aviva on Wednesday to ‘buy’ from ‘neutral’ and lifted the price target by 26% to 480p as it pointed to "turning tides".
Source: Sharecast
The bank said it expects Aviva to deliver a best-in-class capital return yield, underpinned by a strong Solvency II ratio and the best free cash flow yield versus UK life insurance peers.
"We forecast £5.3bn of capital returns between 2023-26F, equivalent to 51% of Aviva's current market cap," it said.
"Our capital generation forecasts for 2025F (£1.69bn) are 10% ahead of consensus largely driven by our more positive outlook in General Insurance (GI)."
Jefferies said earnings should start to shift towards capital-light business, which is well-timed given improving market conditions, and should warrant a premium valuation versus peers.
Whether you're looking for a Share Dealing Account, Stocks and Shares ISA or a Self-Invested Personal Pension (SIPP), we've got an account to suit your needs..
Halifax is not responsible for the content and accuracy of the Markets News articles. We may not share the views of the author. Understand the risks, please remember the value of your investment can go down as well as up and you may not get back the full amount you invest. We don't provide advice so if you are in any doubt about buying and selling shares or making your own investment decisions we recommend you seek advice from a suitably qualified Financial Advisor. Past performance is not a guide to future performance.
