IAG – Credit Suisse rates the stock as Upgrade to Neutral from Underperform

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The company will sell its 26% interest in the joint venture with State Bank of India. Total consideration is over $640m with an expected increase in Insurance Australia Group’s regulatory capital position of over $400m once the transaction completes.

Credit Suisse increases FY20 estimates for reported profit by 34% and also increases the expected FY20 buyback to $750m from $300m. Target increases to $8.00 from $7.50. The broker’s rating is now upgraded back to Neutral from Underperform.

Sector: Insurance.

Target price is $8.00.Current Price is $8.09. Difference: ($0.09) – (brackets indicate current price is over target). If IAG meets the Credit Suisse target it will return approximately -1% (excluding dividends, fees and charges – negative figures indicate an expected loss).

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