In a report released on June 26, Nika MA from CMB International Securities maintained a Buy rating on ZhongAn Online P & C Insurance Co., Ltd (1ZO – Research Report), with a price target of HK$20.40.
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Nika MA has given his Buy rating due to a combination of factors that highlight ZhongAn Online P & C Insurance Co., Ltd’s strategic positioning and financial outlook. The recent share placement, although initially perceived as unexpected, is seen as a strategic move that enhances the company’s capital flexibility. This capital injection is expected to bolster the company’s domestic property and casualty insurance business, particularly in health and auto ecosystems, and to support investments in AI-driven infrastructure.
Nika MA also notes that the company’s financial health remains robust, with solvency ratios well above regulatory requirements, despite a slight quarterly decline. Additionally, the stock’s recent price movements, influenced by regulatory developments and market sentiment, suggest limited downside risks. The anticipated growth in health and auto premiums, coupled with the potential breakeven of ZA Bank, further supports a positive earnings outlook. Consequently, the Buy rating is maintained with a target price of HK$20.4.
In another report released on June 26, DBS also reiterated a Buy rating on the stock with a HK$20.00 price target.