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What us DB sales?
The upgrades keep coming, but it feels like many are just updating to the current price.
The upward movement in the SP seems to be back after the results profit taking.
Q1 trading update with AGM in May Hopefully good DB sales, some limited derisking LTM activity.
Mid August HY results.....
It is a long time between updates to keep the market interested.
Buy the sag in late April and June.
From the RNS Aegon trimmed it holdings by about 10% and sold 7m shares. It still has 50m, so just taking some profits by an asset manager on behalf of its customers.
Still plenty of positive articles about the company.
Still undervalued and on track for my targets of 120 this year and 150 next.
Not to worry....it will start rising once the buyers for results have moved on
Yep. Swing traders closing their positions perhaps?
Typical
The presentation slide deck contains an interesting note that since first writing ERMs the cost to of date NNEG in terms of actual losses has been 10 bps. Given chronic U.K. housing problem I am less concerned about NNEG risk than the theoretical models imply.
The black scholes valuation model of NNEG results in a much higher provision being carried as a deduction in the yield to maturity discounting the liabilities. Over time as this liability doesn’t crystallise the excess reserve over current experience drops through to profit.
Brighty... thank for that informative summary.
We may be disappointed about the non-payment of dividend but there are too many positives to ignore. We should soon have analysts' upgrade that would spice things up.... perhaps even a director's share purchase ...... even a take over target ..... we live in hope!
I am confident JUST will soon be forgotten as a penny share. D)
I must admit, as welcome as today's rise in SP is, I am still disappointed with the market reaction. One thing is for sure though: JUST will not be penny share any more..... if not today, very very soon.
We need some positive news to spice things up. Anlyst's forecast upgrade is one to look forward to but director's purchase of own shares would help beautifully too.
Perhaps understandably and as expected there is no dividend. This is an area where Aviva and Phoenix are a more stable investment proposition. Just may have more upside in SP if they continue to progress but a dividend or an indication of a future one, might show more confidence.
I don’t think Just will hit IFRS net asset value because both Aviva and Phoenix trade below net asset value and they have less capital issues than Just but if they trade at 75% of IFRS nav that still offers upside. The common factor in all three is that they trade at discount to IFRS net assets and beyond goodwill and PVIF in balance sheet there is effectively no other value attributed to future profits. The fear is that future credit losses will exceed provision made in the IFRS balance sheet and that solvency restrictions lock up capital and prevent dividends.
Thanks analyser, you are highlighting this is a complex business that requires detailed analysis to understand it.
It is not as simple as NAV or SCR although these frame the argument about undervaluation.
We can anticipate some analysts coming out with targets up to 200 sparking a further move upwards.
1 Sold ERM portfolio above IFRS book value - this does help underpin view of assets value.
2 Recaptured old financing reinsurance £940 million which reduces size of balance sheet and eliminates historical legacy financing
3 All debts now through Just Group plc which simplifies debt structure in group
4 Earning fees for selling ERM assets which helps expense efficiency
5 More cautious view on property growth within figures which increases robustness of IFRS net assets
Material increase in solvency ratio!! Sp is now how of NAV which is totally bonkers!!
Fingers crossed the market sees it that way!
"2020 was a major landmark in the Group's history. We achieved our goal of becoming capital self-sufficient and we now have more choices in how we deploy our resources" - CEO
Plus tangible net assets per share 199p (FY19: 181p per share).
Other key points:
Adjusted operating profit2 was 9% higher at £239m (FY19: £219m), as higher new business profit and improved in-force return has offset higher finance charges
IFRS profit before tax was £237m (FY19: £369m), as higher operating profit was more than offset by lower investment and economic profits, due to the property growth assumption change and the sale of an LTM portfolio
Retirement Income sales for 2020 up 12% to £2.1bn. Defined Benefit De-risking ("DB") sales were up 22% during the year to £1.5bn. Well positioned for attractive growth in 2021
Looking great here. Good luck, Brighty
At last, it's results day tomorrow for Just Group. Should be very interesting. Hoping to see the NAV at least match the 204p a share recorded at the end of June 2020 - over double the current (very under valued) share price. That will set things up perfectly for a re-rate to £2 per share this year. The curve ball of course, at some stage, could also be a takeover. 2021 is hotting up for Just investors. Good luck, Brighty
Hold for gold.
I expect we will head towards 150p after the results so dont really care about these £1 intermediate target. This for me a long term bet and a no brainer one!! All the hard work is done over past 2 years, now is the time to reap the rewards! Hold Hold Hold IMO.
The sales figures indicate there will likely be earnings growth this year.
The DB derisking market continues to grow, that and equity release mortgages and perhaps a resurgence in Individual Annuities support a narrative for future growth....but they need to have a robust capital position to be able to take advantage of the opportunities.
Just is nearly recovered from its regulatory capital bashing.....a good set of results assures its future and sets up future growth. SP still has some way to go.
What about likely earnings growth.
Results are only a couple of days away....for me they are all about capital generated and the solvency capital ratio.
The capital management actions are said to be neutral, with capital benefits offset by lost future value.....however the SCR should benefit by a lower denominator. Sales have been strong so capital generation should also be positive plus releases from longevity reserves.
160% is looking feasible (145 at June add 9% debt raise, leaves only 6% from H2 actions and results). At that level a small dividend is possible, but they should retain it for growth. I would prefer to see 170% before dividends resume.
Keeps trying to get above £1 but then pulling back.
MNG, LGEN both making substantial releases of capital from annuity business bodes well for JUST next week.
Expecting significant capital generation and uplift in SOlvency ratio.