Baer - New CFO; Deutsche Bank eps upgrades; Reinsurance losses; German reforms, South African insurance

Research evidence excerpt

Baer - New CFO; Deutsche Bank eps upgrades; Reinsurance losses; German reforms, South African insurance

the last two years, versus Sanlam’s 9%, an outperformance that meets our ratings/calls over

the period. For Sanlam, we now see the combination of (1) cheaper valuation, (2) higher dividend yield, (3) credible operating

profit growth in our forecast set, and (4) a credible ROE target as sufficient to justify an Overweight rating at this point in the

cycle. For Discovery, we continue to respect the quality of the franchise and the Vitality-driven global opportunity set, but the

valuation premium and very strong share price run leave less margin for forecast risk and execution variability. After the re-rating,

we believe the stock is better positioned as a Neutral (i.e., balanced risk/reward), pending either a valuation reset or new evidence

that materially upgrades the medium-term earnings/ROE trajectory beyond what is already embedded. Link to note here.

Newsflow and Away from us

• Close Brothers raised to Buy at another broker (bbg)

• DWS cut to sell at another broker (bbg)

• NN GROUP: Small negative. NN Group has published a formal pre-close statement on its website for 1H26. It reiterates

guidance for flattish OCG (operational capital generation) in FY26 vs FY25 (JPMe is slightly ahead of this - no up to date

consensus). Also highlighting various negative impacts for markets, interest rates on Solvency ratio of low to mid single

digits, plus a client transfer of liabilities will result in a 1-2ppt -ve hit to S2 ratio which we don’t think will be embedded in

consensus.

• Another broker remains cautious on the Alternative Asset Managers, putting EQT on negative Catalyst watch into results and

with Bridgepoint and CVC as the Top Picks (bbg)