RBC Capital Markets has raised its price target on Chesnara PLC (LSE:CSN), the life insurance and pension consolidator, to 400p from 360p, maintaining its 'outperform' rating.
The upgrade follows first-half operating capital generation that grew 79% year on year, driven by a larger-than-expected contribution from Chesnara Life UK, acquired earlier this year.
RBC has increased its full-year operating capital generation forecast by 76% to £168 million, while its cumulative 2026 to 2028 estimate stands at £156 million, already above Chesnara's five-year £140 million guidance.
The insurer expects Chesnara's Solvency II ratio to remain at the top end of its 140% to 160% operating range, providing headroom for further acquisitions.
Available liquidity rose to approximately £130 million from £100 million following stronger first-half solvency.
Management signalled readiness to assess further UK deals while continuing to integrate recent acquisitions, with transactions potentially completing in 2027.
RBC said the deal environment remained healthy in the UK, with Germany also seeing increased activity.
Chesnara shares have risen 19% since the start of the year, lagging several UK life insurance peers, which posted gains of between 20% and 32% over the same period.
