Allianz SE, Europe’s biggest insurer, said it may hit the upper end of its full-year earnings forecast after reporting third-quarter profit that beat analysts’ estimates.
Net income fell to 1.26 billion euros ($1.74 billion) from 1.37 billion euros in the year-earlier period, the company said in an e-mailed statement today. That topped the 1.2 billion-euro average estimate of 13 analysts surveyed by Bloomberg.
“With this strong performance, I expect our full-year operating profit to trend towards the upper end of our target range” of 7.2 billion euros, plus or minus 500 million euros, Chief Executive Officer Michael Diekmann said in the statement. Operating profit advanced 2.3 percent to 2.06 billion euros in the third quarter.
The forecast “seems not to be over-optimistic,” Konrad Becker, an analyst at Merck Finck & Co. in Munich who recommends buying the stock, wrote in a report to clients.
Insurers’ profitability is under pressure as low interest rates weigh on investment returns and demand for life insurance weakens. Reduced prices in property and casualty coverage such as motor insurance and catastrophe claims are also hurting earnings across the industry. This year saw a number of costly natural disasters including European winter storm Xynthia and the earthquake that hit Chile in February.
Rest of the article at: http://www.bloomberg.com/news/2010-11-10/allianz-posts-1-7-billion-third-quarter-profit-beating-analyst-estimates.html
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