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Investing.com - Goldman Sachs has upgraded Admiral Group Plc (LON:ADML). (LSE:ADM) (OTC:AMIGY) from Sell to Buy and raised its price target to GBP35.73 from GBP30.00.
The upgrade comes as motor insurance prices, which had been declining over the past year, are now stabilizing and beginning to rise, according to the investment bank.
Goldman Sachs believes industry consolidation could support profitability and encourage rational pricing behavior, with Admiral, described as the most profitable player, positioned to benefit from this trend and grow through strong risk selection.
The investment bank notes that nearly 90% of UK motor insurance sales occur via price comparison websites (PCWs), with the home insurance market following a similar pattern.
Admiral, an established player in the PCW space, is well-positioned to benefit from this trend as demand for home insurance recovers amid an easing cost of living crisis, Goldman Sachs added.
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