“We think QBE has executed well in recent periods, as highlighted by its financial year 2024 result delivering 31% earnings per share (EPS) growth and an 18% return on equity (ROE),” Raymond said.

“With a strong balance sheet, and further upside to come from improvements in its North America business, we continue to see QBE as too cheap trading on approximately 11x FY26F earnings.

“There are six key risks and here they are:

1. Higher claims than expected.
2. Volatile investment markets
3. Insurance competition affecting premium growth.
4. Inability to turn-around QBE’s North American operations.
5. Reserve top-ups.
6. Unforeseen negative regulatory changes.

““We maintain an ADD recommendation with a $26.76 target price,” Raymond said.

GRAPH OF QBE