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In the afternoon, the index fell by 1.3% to 12,435 points. Hannover Re is not yet able to assess the damage caused by Hurricane “Ian” in Florida, but the 2022 profit target of EUR 1.4 to 1.5 billion remains in place. Biotech service provider Evotec is to develop a drug prototype against the plague for the US military for an order volume of USD 50 million.
The Hannover Re share has recently shown itself to be quite robust in the quality index. And on Friday, too, it was slightly up at EUR 156.40. The reinsurer has long been considered a conservative investment thanks to its stronger balance sheet, attractive dividend and possibly the best underwriting conditions. In addition, not only does business seem to be in good shape, but the loss burden from the most recent hurricane “Ian” could also be less severe than feared. Hannover Re then assumes calculated risks in this regard in all geographic regions, provided the business meets the margin requirements. Above all, however, the company achieves competitive advantages through its position as one of the world’s most capitalized reinsurers. Incidental losses from natural catastrophes are also offered for marine and aerospace insurance. Credit and suretyship reinsurance are also important areas of insurance. However, following the minor damage caused by hurricane “Ian” in the US state of Florida, Hannover Re is not yet able to put a precise figure on the burden. The company is still evaluating the damage modelers’ estimates and its own calculations, the CEO said at the London Investors’ Day this week. According to the manager, the reinsurer in Florida has a significantly lower market share than in general. However, Hannover Re may be able to provide more precise burden figures when the Q3 balance sheet is presented on November 3rd.
The special insurer had already defied the immense catastrophe damage caused by hurricane “Ida” and low “Bernd” in 2021 and made a profit of 1.23 billion euros. At the turn of the year, business was further expanded and premiums increased by an average of 4% among customers in the property and casualty segment. Premium income at Hannover Re probably also grew by almost 13% to EUR 27.8 billion last year. And for 2022, despite all the challenges, the board has still set itself the goal of a record profit of 1.4 to 1.5 billion euros, which would ultimately make higher dividend payouts possible. The current return on investment for the stock is a solid 2.9%. If the recently paid special dividend of 1.25 euros were to be added to that, the return would even be 3.7%. This makes Hannover Re one of the most attractive dividend stocks in the quality stock index (QIX). The QIX Germany is a stock index made up of the 25 best German stocks. The 25 shares are selected according to a set of rules that have been tried and tested.
On the other hand, the Evotec share price fell slightly to currently EUR 17.95 in the quality index on Friday. Although the performance of the past few months has been rather disappointing, the biotech company is one of the world’s leading drug discovery and development companies. In recent years, Evotec has specialized more and more in areas such as neural diseases, pain therapy, metabolic and inflammatory diseases and oncology. The actual core business, however, is drug research, which is carried out in cooperation with numerous partner companies from the pharmaceutical and biotechnology industries. These include, above all, large pharmaceutical specialists such as Bayer, Sanofi, Bristol Myers Squibb and also Pfizer and Novartis. And with the high-quality R&D services, Evotec generated solid revenues of around EUR 618 million in 2021. In any case, the management has also set itself ambitious sales targets for the medium term, which envisage an increase in income of around EUR 1.0 billion by 2025. Additional orders, such as those recently received from the US Department of Defense, should also help the Hamburg biotech specialist.
Evotec’s Seattle-based subsidiary Just – Evotec Biologics received an order worth up to USD 49.9 million at the end of September. The aim here was to advance the rapid development of drug prototypes based on “monoclonal” antibodies against the infectious disease plague. It is a clear validation for us of the efficiency and speed we can offer our partners through our leading scientific, technological and professional offering, Evotec said in the press release. If the biotech service provider succeeds in bringing in further lucrative orders and also further expanding the scope of global partnerships, then the 2025 sales plans should be consistently achieved. Especially since Evotec is also aiming for additional margin improvements by then.
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