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On Monday, Goldman Sachs began coverage on Scor (EPA:SCOR) SE (SCR:FP) (OTC: SCRYY) shares, issuing a Buy rating and setting a price target of EUR34.50. The firm’s analyst pointed out Scor’s history of being the lowest performer in total shareholder return among reinsurers over the past decade, attributing this to volatility in both Property & Casualty Reinsurance (P&C Re) and Life & Health Reinsurance (L&H Re).
The analyst noted that under the existing leadership, Scor has taken significant steps to strengthen its reserving practices in both divisions, including conducting third-party reviews. With these remediation efforts now complete, Scor is positioned to potentially achieve top-line growth that surpasses its peers, due to its relatively lower market share.
Goldman Sachs sees the underlying earnings power of Scor’s P&C Re business as considerably stronger than the targeted combined ratio of under 87%. This suggests that there could be upward risks to the 2025/26 consensus estimates for the company’s Value at Risk (VaR) combined ratio. The firm acknowledges that Scor presents a greater risk-reward profile but suggests that if the company can maintain consistent performance without major negative surprises, it stands to benefit from a substantial revaluation due to its currently appealing valuation.
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