Nomura Securities Reiterates a 'Reduce' on Prudential plc (PUK); Putting Valuation In Check

Nomura Securities reiterates a 'Reduce' on Prudential plc (NYSE: PUK), PT 700p.

Analyst, Nick Holmes, said, "We model NBV growth of +5% and +7% in 2011 and 2012, respectively, vs. +34% in 2009 and +26% in 2010, with the deterioration here driven by 1) company’s stated intention to moderate its US growth since it was becoming too large a part of the group; and 2) its demanding comparatives in the US over the past three years, when it tripled its variable annuity market share. The US has been the company’s main growth engine over the past three years, with its contribution to group NBV having grown from 24% in 2008 to 41% in the first nine months of 2011 vs. Asia’s contribution remaining static. Thus a slowdown here will likely put significant downward pressure on the stock’s expensive valuation."

For an analyst ratings summary and ratings history on Prudential plc click here. For more ratings news on Prudential plc click here.

Shares of Prudential plc closed at $23.02 yesterday.

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