Sabre Insurance Share Discussion Threads

[jonwig] 14/10/2021 09:24

wba - yes, I understand your argument, but won't it mean that dividend payments will be nominal not generous?

[wba1] 14/10/2021 09:18

You need to look behind todays trading update. If profit does come in below previous expectations it will be because they have chosen to take a hit this year (presumably thinking they may as well be hit for that as well as depressed premium volume). I have no doubt that the accident year loss ratio and profitability is under pressure, but they are choosing to hold back prior year reserve releases, especially those from 2020 when they stuffed claims reserves. This is usual CEO behaviour to smooth performance over the years and suggests they continue to see profitability of business being written today under pressure and continuing at that level for some time - hence the need to keep the piggy bank topped up. The difference between insurers in a soft market and many other industries is that the insurers can use these tactics to ride out the market until profitability of current business improves - so dividends should be safe (other than minor changes) and declared results this year and for the next couple of years will be driven more by reserve release decisions than anything else.

[jonwig] 14/10/2021 07:57

Is today's profit warning already in the price? Find out soon enough!

[wilksey1] 13/10/2021 08:57

brought a few more just dont see it being this low for too long....

[scepticalinvestor] 12/10/2021 15:18

good grief, someone dumping like mad

[wba1] 05/10/2021 23:09

The spotty oiks are both right and wrong - but for reasons they do not understand. They are wrong about the short/medium term outlook for profit (say to 2023) because Sabre, like most motor insurers) have been stuffing their reserves during the pandemic and declaring higher CORs than needed by overreserving. These excess reserves can be released to sustain profit and divis for a while yet. But they are right to be concerned. Sabre have shown recent trends which point to higher claims ratios going forward. The retention of existing high quality/low claims business has deteriorated in the pandemic and they have introduced some business sources far inferior to their usual business. No insurer has ever made other than marginal profit (contribution to fixed costs) from the SAGA panel.

I think full year may look better than suggested (due to prior year releases and the benefit of H1 lockdowns) but long term I am beginning to think Sabre are in transition to being just another motor insurer but without the scale to make the mainstream model work. The best thing will be to trade them rather than invest long term. I am now looking for a new entry point below 200 and will then sell above 220/225.

[wish i wasnt in rbs] 05/10/2021 17:37

Trading statement due next week or maybe the week after - we will see if the spotty little oiks are right or wrong as usual. Could be a bit of a bear squeeze if all is ok?

[wmb194] 05/10/2021 16:50

Don't know but yesterday Berenberg reduced its target on Sabre from 224p to 199p.

'(Sharecast News) - Analysts at Berenberg lowered their target price on insurance provider Sabre from 224.0p to 199.0p, stating that when "things do not add up" it's time to 'sell'. Berenberg stated that since its downgrade of Sabre to 'sell', its peers had adjusted their numbers on the stock. However, the analysts said they "mark their homework as a C-" and implored them to "do better". While the German bank noted that consensus had moved by about 15% for the next three years, it remains around 20% below consensus for 2022 and 2023 and said it also has concerns that Sabre's pricing discipline was "weakening" given the change in average premium per policy has consistently lagged management's 7.5-8% view of claims inflation since 2014. Finally, Berenberg added that Sabre was beginning to enter "the world of the uncovered dividend" in 2021, which it said was "unusual" given it should have been one of the company's strongest years due to Covid-19. "As a result, we estimate 2020 and 2021 will be the peak years for DPS and then the dividend is set to decline," said the analysts. "For these reasons, we remain sell-rated and believe there is additional 10% downside to our new 199.0p price target."'

[wilksey1] 05/10/2021 16:32

surly this drop has to be well over done...

[chrisb1103] 10/8/2021 13:23

Looks like decent volume today? Have taken a few @226 see if seller is clearing....

[jonwig] 02/8/2021 09:15

With such a thin market, this may have been the trigger:

Berenberg cuts the motor insurance provider to Sell from Hold. The German bank said Sabre's first half results were "lacklustre".

[Morningstar 28/07]

[scepticalinvestor] 02/8/2021 08:37

offers decent value at this level

[jonwig] 27/7/2021 09:02

I was expecting downbeat comments, so not exactly disappointed.

[petewy] 27/7/2021 09:01

Half year report is not exactly cheerful...
Despite our optimism, we remain cautious that market-level price increases always take longer than logic would suggest and so the timing of more substantial growth is still slightly uncertain at this stage. Looking toward the full year, we would anticipate a combined ratio in the 75% to 80% range, in-line with our pricing plans in softer parts of the market cycle and as traffic levels have recovered to pre-COVID levels. We remain committed to using our strong capital range to support an attractive dividend as we earn through the lower premium volumes, ahead of anticipated growth."

[masurenguy] 18/5/2021 01:22

Sabre Insurance

Sabre has a strategy of writing strictly based on profitability rather than volume. A compelling approach when premiums are rising, but when insurers are slugging it out for market share, taking smaller margins or even losses, that makes Sabre more of a cat than a tiger. The challenge is exacerbated when the whole market is falling, as it did last year with fewer people driving because of Covid.

The business was founded in 1982 and was acquired by Aviva before a management buyout in 2002. It was back to the stock market in 2017 - it has a record of using technology developed in-house to write niche policies. One of its specialisms is in expensive, risky policies for young people who have just passed their driving tests — a process disrupted by the lockdowns of the past 12 months.

Sabre’s gross written premiums in the four months to end of April were down almost 16% compared with last year. However, Geoff Carter, 52, Sabre’s chief executive, said that in April alone premiums were up 15%. Sabre will benefit from an opening up of the economy, but it has other strengths, too. The main one is that a shake-out of insurance pricing is coming courtesy of a review by the Financial Conduct Authority, which is set to stop insurers increasing the cost of policies on renewal after attracting first-time customers with cut-price offers. Sabre does not follow that model and believes it will benefit significantly from the changes. That makes Sabre look attractive at 259p, well below most analysts’ target price for the company.

Advice: Buy - strong track record and market developments look favourable

Complete article:

[jonwig] 14/5/2021 09:36

It was, and a typical one for them. The share price is snooty, though.

[petewy] 14/5/2021 09:25

optimistic trading statement

[speedsgh] 21/4/2021 13:21

XD 11.70p tomorrow morning (6.80p final; 4.90p special)

[wish i wasnt in rbs] 07/4/2021 10:03

sbre goes xd in a couple of weeks

[kev0856153] 07/4/2021 08:16

lol we're off again

[wish i wasnt in rbs] 31/3/2021 14:56

As that smoothtalker Kev rightly points out - its worth buying from the 11.7p final divi alone

[wba1] 31/3/2021 13:41

There have been previous spikes when Kayne Anderson Rudnick added to their position. It will be interesting to see if there are any notifications in the next few days.

[wish i wasnt in rbs] 31/3/2021 12:44

I am guessing that with Lloyds reporting £6bn worth of covid claims, motor insurance is looking like a risk free alternative?