Goldman Sachs Says Buy Voya Financial, Assurant

Loading...
Loading...
In a report published Friday, Goldman Sachs analysts initiated coverage of American Life Insurance with a Neutral rating. Against the backdrop volatility from interest rates, currency headwinds and regulation limiting ROE growth, the analysts "favor capital deployment and diversification." The analysts advise to "buy capital returns stories," like
Voya Financial IncVOYA
and
Assurant, Inc.AIZ
, both of which have been initiated with a Buy rating. In the report Goldman Sachs noted, "With the sector trading at 10x P/E and 1.0x BV (1.2x ex AOCI), we favor capital generation and less-restricted deployment to support earnings and valuation. We favor insurers growing earnings in capital-light businesses and using FCF to buy back stock." The analysts expect Voya Financial and Assurant to repurchase shares worth 20 percent of their market cap by 2017. "VOYA is in the midst of a multi-year turnaround that provides levers to improve ROE, while the firm still trades at 80% of book value (ex-AOCI). AIZ is down 5% over the past year despite limited macro exposure, due to concerns around losses in its ACA-related health business and slowing growth in its lender-placed insurance; our sum-of-the-parts analysis suggests 12% upside," the analysts added. The price target for Voya Financial is at $50 and the price target for Assurant is at $72.
Loading...
Loading...
date
ticker
name
Price Target
Upside/Downside
Recommendation
Firm
Posted In: Analyst ColorInitiationAnalyst RatingsGoldman Sachs
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Loading...