Street Calls of the Week
Investing.com - Morgan Stanley has resumed coverage of Assicurazioni Generali SpA (BIT:G) with an Overweight rating and a price target of EUR37.50, citing several positive factors for the Italian insurer. The company, with a market capitalization of $58.71 billion, has demonstrated strong performance with a 38.88% year-to-date return and maintains a healthy P/E ratio of 13.12.
The investment bank highlighted Generali’s European personal lines business as showing strong momentum, with favorable pricing dynamics continuing to benefit the company’s bottom line. According to InvestingPro data, the company has maintained dividend payments for an impressive 34 consecutive years, showcasing its operational stability.
Morgan Stanley also noted that expected U.S. dollar weakness over the next 12+ months could give Generali’s European focus a competitive advantage compared to peers.
The firm pointed out that Generali offers the highest free cash flow yield among large-cap composite insurers, approximately 8.7% for fiscal year 2027 estimates versus peer average of 7.2%, providing greater capital deployment flexibility.
Additionally, Morgan Stanley expects Generali to be one of the biggest beneficiaries of the upcoming Solvency Review, potentially freeing up the equivalent of approximately 6% of market capitalization, though not all immediately. Based on InvestingPro’s Fair Value analysis, the stock currently appears undervalued, supporting Morgan Stanley’s optimistic outlook.
In other recent news, Assicurazioni Generali SpA received an upgrade from JPMorgan, which changed its stock rating from Neutral to Overweight. The investment bank also increased its price target for Generali from EUR34.00 to EUR37.00. This decision was influenced by an improved profit outlook for the company. Additionally, JPMorgan raised its earnings per share estimates for Generali by 1% to 4.5% over the 2025-2028 period. These developments reflect a positive shift in the investment bank’s assessment of Generali’s future performance. The upgrade and increased price target suggest confidence in the insurer’s ability to generate profits in the coming years. Investors may find this information useful when considering their investment strategies.
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