Aviva Share Discussion Threads

[whatsup32] 01/1/2021 11:11

800,000 General insurance claims were paid out by Aviva .

Article is in The Times today

[whatsup32] 01/1/2021 11:05

Insurance claim at Aviva

In one case a driver encountered a tractor pulling a trailer of potatoes round a bend too fast, as a result of which he was bombarded by spuds.
When reporting the incident to Aviva,he commented "There were no injuries but there were some chips from where the potatoes hit the car"

[wskill] 01/1/2021 01:34

A good new year to all and hopefully 2021 will be our year.

[geckotheglorious] 31/12/2020 22:12

They think it is all over.........................................................

For some, tis in 1 hour 48 minutes...

Roll on 2021.
Good fortune to one and all.

[whatsup32] 31/12/2020 21:14

Happy New Year to all . Let’s hope for a sunny Aviva day

[spud] 31/12/2020 20:53

Don't be a git jor! See ya in 31 days. spud

[1robbob] 31/12/2020 15:21

Thanks cjac39 much appreciated
I think that AB still has to earn the right to retain 50% of net profits!!!
I am in no way an expert on Insurance, but it is quite obvious that she has to
improve the return on equity, which must only be circa 8%

Happy New Year all....lets hope that it is safe and much more prosperous

[cjac39] 31/12/2020 14:28

also compare op profits vs the divi and it shows how affordable and persistent the 21p or c£850mln is vs net of tax profit available to pay it of close to 2x

[cjac39] 31/12/2020 12:41

forward cashflows are readily available. i could go into a more detailed work through but with aviva its hard to know quite how much capital they hold in various divisions and what gets diversified away.

a simple version would be take 2019 from the 2020 half year results preso page 11 and annualise:

UK Life and savings £1.7
GI UK, Irel, Can £0.7
central -£0.1 (this should clearly go down on sales but we shall see)
debt (reduced) -£0.15

= £2.15 per ann op profit

as i write this though it makes you realise how garbage their savings and asset mgmt business is. they shout about £350bln of aum plus platform etc but if they are only making £1.7bln across the whole thing i would expect most of this comes from annuities and heritage.

a good rule of thumb for annuities is that you hold 12% S2 capital and this unwinds (with no new biz) at 6-7% per ann. you expect to make c35bps default spread and 35bps longevity margin normal year (prob higher with eq release). therefore aviva have £75bln * 12% = £9bln * 6.5% = £0.6 + £0.3+£0.3=£1.2bln. clearly any of this could be inaccurate but not out by a huge amount.

heritage fund I'm not so sure about but must new few hundred million if you benchmark to m&G which means savings and asset mgmt is low hundreds at best along with protection.

to make low hundreds off £350bln tells you its quite low quality, index type stuff. this is the reason why i think an M$G combination is so compelling because they do have a very good asset mgmt business.

[wskill] 31/12/2020 11:57

AB always seems to use the phrase at pace I wonder if there already has been an approach which was not at a price which was palatable for larger shareholders .AB was drafted in to clear the decks and make Aviva a saleable proposition at least a bite sized morsel for another more capable insurance company.
One thing we have no shortage of in the UK is poor management I do hope AB is not more of the same we have had at Aviva in the past.

[spud] 31/12/2020 11:50

Can Aviva shares recover to beat the FTSE 100 index after a 25% price fall in 2020?
Do Aviva shares (LON: AV) (AV.L) have the capacity to outperform the FTSE 100 index

Aviva shares (LON: AV) (AV.L) have experienced a sharp fall in their price since the start of 2020. They are down 25%, which is 10 percentage points worse than the FTSE 100 index (INDEXFTSE: UKX) has managed in the same time period.

However, the insurance firm is now embarking on a major strategic shift. It includes asset disposals, a new dividend policy and a push towards focusing on markets where the company has its largest competitive advantages.

In my view, these changes and its low share price valuation could mean that it offers recovery potential over the long run.

A new strategy could boost Aviva shares

Aviva shares could gain a boost from a new strategy under new CEO, Amanda Blanc. The FTSE 100 company’s third quarter update included details of asset disposals in Singapore and Italy for a total of £2 billion. This could improve the company’s financial position, but more importantly it may simplify its business model. The result of this may be greater returns and improved efficiency that allows the firm to become more flexible to investment opportunities.

Other asset sales seem likely to take place in future. The business highlighted in its quarterly update that it is exploring options across its portfolio, with a view to making more disposals where it is unable to meet strategic ovjectives. This may lead to a degree of caution from investors, in my view, over the short run. They may adopt a wait-and-see attitude to see how the company’s strategic shift affects its financial position and profitability.

Improving fundamentals in an uncertain economic backdrop

Alongside a streamlined portfolio, Aviva’s share price may also be affected by a revised dividend policy. It intends to return excess capital once financial metrics such as its debt leverage target have been met. In practice, the company expects this to mean a low to mid-single digit rise in dividends over the long run. The company’s dividend yield of over 7% means this could make it an attractive income opportunity.

The firm’s financial outlook is obviously difficult to accurately forecast while the global economy experiences an uncertain period, and the company makes changes to its asset base. However, Aviva’s stock has a forward price-earnings ratio of 6 using next year’s forecast earnings. This could mean it offers a margin of safety ahead of what may prove to be a period of change for the business.

Therefore, in my view, Aviva shares offers long-term recovery potential. The firm is likely to take some time to make necessary changes to its asset base to position it for growth. In a tough economic environment, this may not be helpful in improving investor sentiment. However, it could lead to a turnaround that equates to the stock outperforming the FTSE 100 index in future years.

spud

[eurofox] 31/12/2020 11:49

doom, and more doom - today was simply a well-executed bear raid - to be taken advantage of

[karv1] 31/12/2020 11:40

I would look at it from the other direction and ask why has the share price has not gone up. (1) I would guess the GT issue would be 1 factor. I think this will be the game-changer moment for the share price if they can sell all of AV France.


(2) investors dream of becoming rich a company that is going to shrink by 30% is never going to make you rich. A company is never going to grow by shrinking this will put off long term investors.

(3)if everything goes well no one knows what is going to happen with the money ie buyback/ specials /debt, the uncertainty is never a good position for new shareholders.

(4) AS the share price rises old shareholders that feel like they been screwed will sell soon as they feel they can live with the losses.

Not everyone is able to understand the in-depth calculations from some on here.
Some will just see a share price that's down 30% this year and a dividend that's been slashed by 30% and profits that are going to be slashed by 30%

[1robbob] 31/12/2020 11:27

To cjac39 and other Insurance Industry Gurus

I am guestimating that circa 66.6% of Aviva's earnings eminate from the
Uk/Ireland and Canada long term core of the business and that this equates to circa £1.35bn at the eps level

Looking at other comparable businesses, what earnings should AB be able to generate from them?

[hhhold2] 31/12/2020 11:18

Aviva still on a PE of 6 ?

long term this company is going up as its been shooting itself in the foot for far to long and is still far to cheap and even if there's another crash its will just be another opportunity to add,

if AB cleans it all up & then Aviva gets taken out that will do also,

putting the chart on long term what's not to like here still?

every dog has its day.

[father jack1] 31/12/2020 09:46

Wholeheartedly agree, this is a straightforward buy at this level. Even at 360p you have a guaranteed 6% yield, in this zero interest rate environment, that'll do.

[cjac39] 31/12/2020 08:33

A solid level to add at. You cannot escape the logic that c40% of the market cap at this level will be realised in cash in next 12 months and the residual business net of debt is still worth the current market cap. And you get paid 6.5% defence on the way. Crazy.

If the U.K. income funds wake up to this and start trusting this new mgmt team it should surely start appearing in more top 10 lists

[eurofox] 31/12/2020 08:09

added at 322.2

[geckotheglorious] 30/12/2020 15:20

Anthony,

Never hurts to take a profit - and it sounds you are a weak hold from here.
Why not trim a slice, take your profit, and keep the rump.

Just my thoughts.

You could trim and see the price fall back - you'd feel better knowing you took some profit despite such eroding in what remains of your position.

Alternately you could hold it all, and see more of your profit erode if it falls.

If it rises, you've the reverse problem.

Really down to you but as a weak hold it never hurts to trim(especially if you've an overweight position in this one relative to the rest of your porty) and take a profit. You can put that to work in a company you've identified as offering better growth/risk reward prospects for example..or even spend it! Pay off some debt...

[woodhawk] 30/12/2020 15:08

The only advice I would give is don't ask for advice on whether to hold, buy or sell shares on these boards. Make your own decisions and if you keep getting it 'wrong'... sell up and move on.

[dr biotech] 30/12/2020 14:53

As I once read, if you sold all you holdings tomorrow would you buy back the same shares? If not why are you holding?

It’s a good way of thinking sometimes (obv dealing charges have to be considered), but if you have a better idea do that. I’m hoping for a better year here, but have also made a resolution to sell these by the end of the year (2021). AB is doing something radical, and I think most of the gains (or losses) from he actions will occur in the next 6-12 months.

[anthony100] 30/12/2020 13:46

Any views on whether it is worthwhile trimming Aviva holdings today or tomorrow?

Fund managers will be squariing their booke to maximise bonus assessments.

At 330p this is a holď not a buy for me...no adding to holding... but i'm not averse to paying a bit of stsmp duty..if that could result in a trading profit.

[anthony100] 30/12/2020 13:45

Any views on whether it is worthwhile trimming Aviva holdings today or tomorrow?

Fund managers will be squariing their booke to maximise bonus assessments.

At 330p this is a holď not a buy for me...no adding to holding... but i'm not averse to paying a bit of stsmp duty..if that could result in a trading profit.

[cyberian] 30/12/2020 13:06

Difficult to really understand why LGEN is showing better gains than here....at least for the moment. I am in both by the way.