Results overall were steady, leading to a muted market response.
Aviva (AV.) confirms review of its Asian business
- Mixed results for investors to digest, with profits from general insurance rising while life insurance and fund management are both down.
- Market delivers muted response to results, with shares rising just 0.6% in early trading.
- With factors such as a healthy capital position and high dividend yield, we continue to recommend these shares as a ‘Buy’.
The well-known insurance group has confirmed it is reviewing the options for its Asian business, including the possibility of a sale. There were reports in the media last week that the company, whose CEO has hinted at major restructuring plans, was considering a sale of the rapidly growing unit which could generate £1.5bn. The first half results were rather mixed with profits from general insurance up 29% but those from life insurance and fund management were both down.
The response to the news from the market this morning was muted with shares up just 0.6% in early trading. They are trading near the bottom of their range over the past three years and it will be interesting to see the details of further restructuring and targets when the company reveals them in November.
Our view on Aviva - Buy
With a relatively healthy capital position and high dividend yield of 8.3% the shares remain attractive for income seekers so we retain our ‘Buy’ recommendation for those willing to accept a medium level of risk.
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