Admiral Group Plc (LSE:ADM) was top of the FTSE 100 leaderboard on a day when most of the index was in the red, bouncing back from a fall at the end of last week on the back of results.
While the share price reaction to Admiral’s results was muted on Thursday, with the shares down around 2%, analysts at Berenbery said there were "plenty of reasons to be very optimistic about the outlook", and raised its share price target as a result.
Alongside the full-year numbers, chief executive Milena Mondini de Focatiis (pictured) had said its motor insurance prices had peaked.
Indeed, the Berenberg analysts said they "believe the hesitancy of investors to keep buying Admiral is driven by a nervousness that UK motor insurance prices will fall",
"While this is a risk, in our view, investors did not fully appreciate how far ahead in pricing Admiral is versus the rest of the market," they said.
They noted that the full-year motor premium numbers were 19% better than expected in the second half and "it was all driven by pricing", with prices raised 37% by the company in the year, well ahead of the market average 25%.
"This gives Admiral scope to cut prices a little, while maintaining excellent margins and growing market share."
Berenberg lifted its price target on the shares to 2,973p from 2,961p.