Aviva Share Discussion Threads

[alphorn] 26/11/2020 12:56

Yes, I am tempted back into Av. Remains on my watch list.

[muscletrade] 26/11/2020 12:45

@Alphorn, it is already well well below bite sized. "Aviva light" is worth circa 400 to 420p/share and the £7billion cash from new disposals is worth 178p/share.

[alphorn] 26/11/2020 12:39

How long will Aviva stay independent once it has shrunk itself down into a domestic business and becomes 'bite sized'?

[whatsup32] 26/11/2020 12:36

It’s not always bad news to buy back shares.

Microsoft have been buying from $100 for the past 10 odd years . Current share price $213 .
So excellent value for shareholders.

However Kingfisher did same and lost value for shareholders.

In Aviva’s case , they haven’t failed to disappoint me for past 2 years. I suspect my short term defensive investment is going to be a long term hold.

[waterloo01] 26/11/2020 12:35

Plenty of time before they make the call as to excess cash. Nice problem to have.

[scrwal] 26/11/2020 12:33

I always vote against buy backs where possible. The only thing that irks me about special divs is that most of them are paid in one go - I would prefer the payments spread out.

[muscletrade] 26/11/2020 12:32

@ken, hard to disagree.

[kenmitch] 26/11/2020 12:25

Those so keen on buybacks should question what happened to the share prices of many Companies who had bought back heavily last March. They provided NO support for the share prices.

E.g WHITBREAD “rewarded̶1; their shareholders by giving ALL the £2 billion or so proceeds from their Costa sale back to them via buybacks. The share fell steadily after that so called reward and ended up halving! Some reward that was!

When will Investors, Companies and bb posters wake up to facts about buybacks instead of being wrongly convinced by the theory.

Give me dividends and special dividends every time. Then investors get real cash. Buybacks reward those who SELL and punish those who stay invested.

[muscletrade] 26/11/2020 12:22

Spud, your view on buybacks is very well known and i have no intention of trying to persuade you otherwise.
The disposals will indeed erode the ongoing bottom line. However in the conference call presentation they showed that the rebased dividend will be covered by "Aviva light", ie after disposals and this is their entire basis for the 21pence divi.

If they were to return the entire proceeds from the new disposals in cash(circa£7bln) that is equivalent to 178p per share.

It is progress on the disposals and policy on how and how much of the proceeds are going to shareholders that will dominate the share price for the foreseeable.

[speedsgh] 26/11/2020 12:22

@wba1 - re your post 5632...

I am intrigued by your comment "The comments about remediating personal lines premiums are good for the likes of Direct Lines and Sabre. I will watch their volumes and results with interest."

The actual text from the results is:
"UKGI NWP was stable at £3.2 billion (9M19: £3.2 billion). In commercial lines, we grew premiums by 10% due to rate increases and targeted growth. This was offset by lower personal lines premiums as we prioritised profitability by simplifying our portfolio and remediating poor performing segments."

What does this actually mean? Have they withdrawn from poorer performing segments, therefore less competition/larger market share for DL/Sabre?

[waterloo01] 26/11/2020 12:18

I remain happy with the update. Sustainable and growing divi, reduced debt, prospect of excess returns and some capital growth. On a longer term view, as part of the dividend bit of the portfolio, it ticks the boxes, as it will for income funds.

[alan@bj] 26/11/2020 12:17

Investors Chronicle's summary today:-
As we recently noted, life insurers have proved far more resilient to this year’s pandemic fallout and the longer-term low interest rate environment than many expected. Aviva is no exception to this, but still trades at a 21 per cent discount to net assets. Unwinding the conglomerate discount will take time, but Ms Blanc has made a solid start. Buy at 325p.

[spud] 26/11/2020 12:12

My main concern is that with all these disposals eroding the ongoing bottom line profits for a one off lump sum, shareholders will never actually see the money. If shareholder returns alludes to buybacks, then I despair. If however, they pay the money back to shareholders via a special dividend, then I will feel happier.

My worry is that it'll be wasted on buybacks.

spud

[wba1] 26/11/2020 12:11

France always takes a long time; government interference and union muscle always reminded me of Longbridge in the 70s. But even if a final resolution takes time that is no reason not to make progress with other divestments (or even parts of France). It should be a doddle to sell some bits such as the Italian general insurer (and there is no point hanging on to it given its small size).

[dr biotech] 26/11/2020 12:02

Have to remember about 3 weeks ago these were 260. If you bought then then 21p is about 8% - that plus hopefully a decent slug of capital return would make a compelling investment.

Bit disappointing to here that the French disposal is still in its early stages - seems that the posts here and article in Les Echos was correct about needing a french solution. I've sold a few today, I feel this is going to take some time to achieve the value that is locked in. While hold the rest longer term

[mo123] 26/11/2020 11:59

1 you may have missed spud;

hxxps://www.ii.co.uk/analysis-commentary/covid-19-blights-progress-aviva-balance-sheet-stays-strong-ii514296

[muscletrade] 26/11/2020 11:58

At the risk of repeating myself...In the conference call They more or less acknowledged that the proceeds from sale of Italy Singapore and Indonesia will reduce debt to their target level(30% leverage) they also have stated in the RNS and the conference call slides that they already hold surplus capital(1.77Bln..my estimate) so why would they not hand over all the proceeds circa £7bln from the other disposals, unless they redeploy of course.(which may not be a popular choice).

[karv1] 26/11/2020 11:51

Thanks, I am just greedy, I was very lucky I brought AV I think on its lowest day and have traded it a lot since with some banks thrown into the mix as well. Increasing my pot more than what AV has gone up by to the point now where a 9.5 to 10% return would have been amazing and AV would have been a keeper. On a 21p dividend, it is not so much so, it just caused me to get very frustrated as I will be very tempted to day trade again with all the risks.

[hhhold2] 26/11/2020 11:48

Well its rude to not grab a few more this morning as the Mugs have dropped this again,

will they ever learn.

[anthony100] 26/11/2020 11:42

Jam tomorrow has always been the hope for Aviva investors.

I see a figure for Solvency 2 in the press release but not one for current leverage. Maybe I'm missing something as Just skimmed the RNS drivel.

The big deal here are returns of capital and divis the metrics chosen should be up in flashing lights together with s current position statement.

I assume the Regulator has given the nod here and won't give implicit permission until the 30 percent caper is secured.

The only surprise is that this Board did not include an anti slavery policy to cheer us up.

[muscletrade] 26/11/2020 11:31

@karv1. I hear you and am sympathetic to your view. Having said that I could argue that if the market was to properly value Aviva in its current form(fat chance at the mo)you could see the share price double. (See my previous post where I tried to suggest true valuation).
At the moment I would value the new core "Aviva light" at about 400/420p. and France Poland joint ventures and the rest of Italy and surplus cash at roughly an extra £7Billion although some on here will have a much better handle on the value of the businesses to be sold.
If excess cash was returned as special div and the share price settled at 420p then arguably you could almost double your return in a couple of years not 5....if you bought today.

[anthony100] 26/11/2020 11:21

I hold this share currently. Having bought at a reasonable cost it shows a profit plus yield.

Having said all that Aviva never fails to fall into any hole in the road.

Working for AV investors I wrote for what it is worth the ICAAPs and Solvency 2 stuff for that unit. Tt has always been run by mediocre jobsworths to.spin out their time doing nothing useful. Remember Moss? He was booted out for fornicating in the Office. Best work he accomplished.

Getting back to the share...in a low interest environment where one can borrow for 3 per cent over MTNs what is the point of reducing leverage? The explanation escapes me.

It smells strange. The units sold produce better returns than that.

Give the money back to me. I am confident enough that 3 percent plus is achievable by even this writer.

This should be a goldmine. A tender offer at 400p would suit me just fine.