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Hannover Rueck SE HNR1

Morningstar Rating
€227.00 +0.90 (0.40%)
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Company Report

Hannover Re Earnings: Tracking Our Thesis in Property and Casualty; Lagging in Life and Health

In first-quarter 2024, we think Hannover Re continued to demonstrate its growth strategy. In property and casualty it grew reinsurance revenue on a foreign-exchange-adjusted basis by 5%. That growth is mainly attributable to structured reinsurance and insurance-linked securities, as well as Europe and US sales. In recent years, Hannover Re has grown structured reinsurance by about 30% a year. Its reinsurance revenue of EUR 4.743 billion is below the EUR 4.884 billion company-compiled consensus estimate and around our 2024 EUR 18.51 billion estimate. We think Hannover Re is still less oriented to natural catastrophe sales, utilizing EUR 52 million of its EUR 378 million property and casualty budget for a large loss. Uncertainty remains over the initial estimate for the Scott Key Bridge in Baltimore, but that loss should be well covered. The firm's full-year target for its combined ratio is below 89%. In the first quarter the combined ratio is 88%, about the 88.3% consensus estimate. Our full-year estimate is 88.97% including a 7.5% discounting effect. The first quarter carries a 7% discounting effect.

Price vs Fair Value

HNR1 is trading at a 856% premium.
Price
€226.10
Fair Value
€894.00
Uncertainty
Medium
1-Star Price
€118.58
5-Star Price
€916.80
Economic Moat
Bftvb
Capital Allocation
Bykzyfqj

Bulls Say, Bears Say

Bulls

Hannover has a history of leadership in an expense-based cost advantage.

Bears

Hannover’s expense-based cost leadership is theoretically replicable, as peers could also move to a low-cost location.

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Trading Information

Previous Close Price
€226.10
Day Range
€222.90228.00
52-Week Range
€184.35256.60
Bid/Ask
€0.00 / €227.80
Market Cap
€27.38 Bil
Volume/Avg
77,778 / 119,412

Key Statistics

Price/Earnings (Normalized)
16.83
Price/Sales
24.14
Dividend Yield (Trailing)
2.63%
Dividend Yield (Forward)
2.63%
Total Yield
2.68%

Company Profile

Hannover Re is a reinsurance company headquartered in Hannover, Germany. Its roots go back to the 1920s when, in conjunction with the Gerling Group, Haftpflichtverband founded Eisen- und Stahl-Industrie to provide reinsurance services. In the 1960s ownership of the business was turned over to Haftpflichtverband, and Aktiengesellschaft für Transport und- Rückversicherung was founded. This was the basis of Hannover Re. The business expanded into life and health reinsurance in the 1990s, and over the next 30 years expanded beyond its core domestic market of Germany to write business internationally. Hannover sold its commercial specialty insurance business to Talanx in January 2019. Hannover was listed in the 1990s on the Frankfurt Stock Exchange.
Sector
Financial Services
Industry
Insurance - Reinsurance
Stock Style Box
Large Core
Total Number of Employees
3,756

Competitors

Valuation

Metric
HNR1
MUV2
SREN
Price/Earnings (Normalized)
16.8313.6711.74
Price/Book Value
2.692.072.37
Price/Sales
24.141.040.76
Price/Cash Flow
87.377.9615.37
Price/Earnings
HNR1
MUV2
SREN

Financial Strength

Metric
HNR1
MUV2
SREN
Quick Ratio
Current Ratio
Interest Coverage
12.5219.708.98
Quick Ratio
No chart available

Profitability

Metric
HNR1
MUV2
SREN
Return on Assets (Normalized)
2.83%1.73%1.83%
Return on Equity (Normalized)
19.22%16.53%23.32%
Return on Invested Capital (Normalized)
15.57%14.83%10.47%
Return on Assets
HNR1
MUV2
SREN
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Insurance - Reinsurance Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
MURGF
Munchener Ruckversicherungs-Gesellschaft AGHxh$67.4 Bil
MURGY
Munchener Ruckversicherungs-Gesellschaft AG ADRYdybjkkkrKbksw$66.3 Bil
SSREF
Swiss Re AGJtzm$35.3 Bil
SSREY
Swiss Re AG ADRZxgdhdnjDtmr$35.3 Bil
HVRRF
Hannover Rueck SENjdhgfbxXtyg$29.5 Bil
HVRRY
Hannover Rueck SE ADRSwctnhqtrLfnd$29.5 Bil
EG
Everest Group LtdFcjl$16.8 Bil
RGA
Reinsurance Group of America IncKbpc$13.8 Bil
RNR
RenaissanceRe Holdings LtdFzkwwhkpmVzr$12.0 Bil
SCRYY
SCOR SE ADRJnkrqvhgwQsvr$5.3 Bil

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