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On Tuesday, Berenberg raised the price target for AXA SA (EPA:AXAF) (CS:FP) (OTC: AXAHY) stock to EUR46.00, up from the previous EUR41.50, while reiterating a Buy rating on the shares. The adjustment reflects anticipated benefits from the strong U.S. dollar on the company’s revenues and emphasizes AXA’s valuation as attractive compared to its insurance industry peers. Trading at a P/E ratio of 11.2 and offering a 4.7% dividend yield, InvestingPro analysis suggests the stock is currently undervalued.
The firm’s analysts pointed out that AXA’s financial results for the full year of 2024 were more robust than expected, with earnings surpassing the consensus estimate by EUR0.1 billion, totaling EUR8.2 billion. This performance is seen as a potential catalyst for the company, alongside prospects for improved revenue growth and a predicted buyback total in 2025 that could exceed the EUR2.8 billion forecasted by Visible Alpha consensus. With a market capitalization of $79.5 billion and revenue growth of 6.25% in the last twelve months, AXA demonstrates solid financial performance. For deeper insights into AXA’s financials and growth prospects, investors can access comprehensive analysis through InvestingPro’s detailed research reports.
Despite potential uncertainties stemming from France’s upcoming budget and its potential influence on the group’s tax rate, Berenberg analysts view AXA’s exposure to France as very manageable. This assessment suggests that the impact on the company should be relatively minor.
The raised price target is also a result of Berenberg analysts rolling forward their sum-of-the-parts valuation from their forecasted earnings for the year 2025 to 2026. This forward-looking approach takes into account the expected financial performance of AXA over the next few years, contributing to the more optimistic valuation of the company’s stock.
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