- Sabre Insurance is a niche player in the long-term attractive U.K. motor insurance industry, with a $750m market cap. and a 7%+ Dividend Yield.
- It has a differentiated model, exclusively focused on underwriting profits and disciplined about pricing, giving it the best underwriting ratio.
- In recent years, the “down” cycle in industry premium pricing meant Sabre’s volume and margin have been deteriorating, albeit slowly.
- We believe the cycle will turn in next 1-2 years, boosting Sabre's earnings; in the meantime, all profits are distributed as dividends.
- At 232.0p, Sabre shares can deliver a total return of 48% in just over 3 years (14.0% annualised). We initiate a Buy rating on the stock.
For further details see:
Sabre Insurance: 7%+ Yield While Waiting For Cycle To Turn