Direct Line’s capital market day on 10 July should act as a positive catalyst for the shares and highlight its scope for substantial shareholder payouts, says UBS.
According to the Swiss bank, the insurer is set to announce an attractive regular dividend yield, £300 million in share buybacks plus further initiatives on cost savings and a channel shift of the Direct Line Brand.
“This leaves Direct Line set to distribute more than 40% of its mkt cap over the next 3 years” and trading on less than 7.5 times adjusted 2025E P/E, UBS reiterates its ‘Buy’ rating.
Shares eased 1% to 201.8p.