Hannover Re Earnings: Slightly Ahead of Expectations, Guidance Maintained; Shares Fairly Valued

Hannover Re's full-year financial results for 2023 were slightly ahead of expectations, delivering net income of EUR 1.828 billion versus our estimate of EUR 1.811 billion. Consensus estimates, as collected by the company, were for net income of EUR 1.802 billion. The business is proposing a total EUR 7.20 dividend per share, made up of EUR 6.00 in ordinary dividend and an EUR 1.20 special dividend. Our forecasts were for a total dividend of EUR 7.23 per share, ahead of the EUR 6.90 total dividend per share as per the company-collected consensus. Not much has changed in terms of the outlook for the business, with guidance for this year of a net income figure greater than EUR 2.100 billion. That guidance is subject to large losses not exceeding the 2024 budget of EUR 1.825 billion. Large losses last year came in at EUR 1.621 billion, within the budget of EUR 1.725 billion. Hannover’s balance sheet remains strong, with a 269% solvency ratio that is above the 200% minimum target. We maintain our EUR 225 per share fair value estimate and our no-moat rating.