Chesnara

HOLD

19/05/2010 Robert Tyerman

After a strong first quarter, acquisitive life insurance investor Chesnara says helpful market trends have offset subsequent yield falls.

The fully-listed company, which paid a bargain £20m last year for Moderna Life of Sweden and later bought the continuing business and personnel of another Swedish group Aspis, increased its embedded value nearly 60% to £278m in the first three months of this year and lifted pre-tax profits fourfold to £12.9m. UK profits more than doubled to £8.9m and Moderna chipped in a maiden £4.4m.

Chesnara owns closed life insurance company Countrywide Assured, but Moderna continues to write new business and is building up a strong position in the Swedish unit-linked insurance market. Chief executive Graham Kettleborough says the company continues to see ‘a decent flow of potential acquisition opportunities’ and remains ‘open-minded’ as to their location, in the UK or Western Europe.  

Growth Company Investor highlighted Chesnara last year at 144.75p and suggested partial profit-taking at 230p in March. The shares have since eased to 210p, but could still bring rewards for those prepared to wait.

Tags: Deals & contracts, Full list, Growth Stocks, Mergers & acquisitions

Sector: Life Insurance

Companies: Chesnara

Market cap: £220m

PE Forecast: n/a

Share price: 210p