Berenberg Raises Swiss Re Target to CHF 160 - 'Buy'

Swiss Re shares rose on Tuesday after Berenberg upgraded the stock to "buy" from "hold" and raised its target price to CHF 160 from CHF 130.

The bank cited Swiss Re's strong capital position, improving underwriting margins, and potential for growth in Asia as reasons for the upgrade.

Berenberg analyst Michael Huttner said in a note to clients that Swiss Re is "well-positioned to benefit from a number of factors, including the improving global economy, rising interest rates, and increased demand for insurance."

Huttner noted that Swiss Re's capital position is "very strong," with a solvency ratio of 226% at the end of 2022. He also said that the company's underwriting margins are improving, with a combined ratio of 96.5% in 2022, down from 98.1% in 2021.

Huttner said that Swiss Re has "significant potential for growth in Asia," where the company has a strong presence in China, India, and Southeast Asia. He noted that the region is expected to account for a growing share of global insurance premiums in the coming years.

Berenberg's upgrade of Swiss Re comes after the company reported a strong set of results for 2022. The company reported a net income of CHF 4.2 billion, up from CHF 3.5 billion in 2021. The company also announced a share buyback program of up to CHF 1 billion.