Nomura Securities Maintains a 'Reduce' on Prudential plc (PUK); Anchor Report; Prefer Aviva (AV)

Nomura Securities maintains a 'Reduce' on Prudential plc (NYSE: PUK), PT lowered from 740p to 680p.

Analyst, Nick Holmes, said, "Investors have largely rejected embedded value accounting as a valuation benchmark in the European insurance sector because of its inconsistency and opacity. Yet there is one stock that the market still seems to benchmark against its peer group on an embedded value basis: Prudential. In our new in-depth analysis of Prudential’s embedded value, we show that its published figures are not comparable with those of most of its European peer group and would, we estimate, need to be reduced by 40% on a like-for-like basis. Reducing Prudential’s EV by 40% would put it on an EV multiple of 1.7x compared with the European insurance sector on 0.8x, highlighting its over-valuation, which is already apparent to us on an IFRS basis. We recommend switching out of Prudential into our top UK insurance picks: Aviva (NYSE: AV) and Legal & General."

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 $25.83 yesterday.

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