Shares Magazine - August 22, 2019

GREAT IDEAS UPDATES

1  | SHARES | 22 August 2019

GLOBAL INSURANCE BUSINESS WƌƵĚĞŶƟĂů;WZhͿ

ŚĂƐŚĂĚĂƚŽƵŐŚƟŵĞŝŶƌĞĐĞŶƚǁĞĞŬƐ͘/ƚƐůĂƌŐĞ

ĞdžƉŽƐƵƌĞƚŽƐŝĂŶŵĂƌŬĞƚƐŝƐĂŬĞLJĂƩƌĂĐƟŽŶďƵƚ

ƚŚĂƚŚĂƐĂůƐŽĐŽŶƚƌŝďƵƚĞĚƚŽƚŚĞǀŽůĂƟůŝƚLJƐĞĞŶ

ŝŶƚŚĞƐŚĂƌĞƐĂƐ^ŝŶŽͲh^ƚƌĂĚĞǁĂƌĨĞĂƌƐƐƉŽŽŬ

ŝŶǀĞƐƚŽƌƐĂŶĚƚĞŶƐŝŽŶƐĞƐĐĂůĂƚĞŝŶ,ŽŶŐ<ŽŶŐ͘

dŚĞƌĞƐƉŽŶƐĞƚŽƚŚĞĐŽŵƉĂŶLJ͛ƐĮƌƐƚŚĂůĨƌĞƐƵůƚƐ

;ϭκƵŐͿǁĂƐĨĂŝƌůLJĚŽǁŶďĞĂƚƚŽŽ͘dŚŝƐƐĞĞŵĞĚ

ĂƚŽƵĐŚŚĂƌƐŚŐŝǀĞŶƚŚĞƐƚƌĞŶŐƚŚŽĨƚŚĞŶƵŵďĞƌƐ

ǁŚŝĐŚƐĂǁĂϭκйŝŶĐƌĞĂƐĞŝŶƉƌŽĮƚ͘WůĂŶƐƚŽ

ĚĞŵĞƌŐĞŝƚƐh<ŽƉĞƌĂƟŽŶƐĨƌŽŵŝƚƐƐŝĂŶďƵƐŝŶĞƐƐ

ĂƌĞĂůƐŽŽŶƚƌĂĐŬĨŽƌƚŚĞĨŽƵƌƚŚƋƵĂƌƚĞƌŽĨϮϬϭε͘

^ƵďƐĞƋƵĞŶƚƚŽƚŚĞƌĞƐƵůƚƐĂŶŶŽƵŶĐĞŵĞŶƚ͕ƚŚĞ

ƚƌĂŶƐĨĞƌŽĨάϭϮďŶŽĨĂŶŶƵŝƟĞƐĨƌŽŵWƌƵĚĞŶƟĂůƚŽ

ZŽƚŚĞƐĂLJ>ŝĨĞǁĂƐďůŽĐŬĞĚďLJƚŚĞ,ŝŐŚŽƵƌƚŝŶ

>ŽŶĚŽŶ;ϭςƵŐͿ͕ǁŚŝĐŚůŽŽŬƐůŝŬĞĂďůŽǁƚŽƚŚĞ

ĚĞŵĞƌŐĞƌƉůĂŶƐ͕ĂůƚŚŽƵŐŚƚŚĞĐŽŵƉĂŶLJƐƚƌĞƐƐĞƐ

ƚŚĞƐĞĂƌĞƵŶĂīĞĐƚĞĚďLJƚŚĞŶĞǁƐ͘&ŽƌŽƵƌƉĂƌƚ

ǁĞƌĞŵĂŝŶŽƉƟŵŝƐƟĐŽŶƚŚĞůŽŶŐͲƚĞƌŵƉƌŽƐƉĞĐƚƐ

ĨŽƌWƌƵĚĞŶƟĂů͘

d,EZ'z^hWW>zŐƌŽƵƉEĂƟŽŶĂů'ƌŝĚ

;E'͘ͿŚĂƐďĞĞŶƚŚƌƵƐƚŝŶƚŽƚŚĞŶĞǁƐĂŌĞƌĂŐƌŝĚ

ƉŽǁĞƌďůĂĐŬŽƵƚŽŶεƵŐƵƐƚ͕ŚŝƫŶŐŚŽŵĞƐ͕

ďƵƐŝŶĞƐƐĞƐĂŶĚŝŶĨƌĂƐƚƌƵĐƚƵƌĞ͘dŚĂƚƉƌŽŵƉƚĞĚ

ŐŽǀĞƌŶŵĞŶƚŵŝŶŝƐƚĞƌƐĂŶĚƌĞŐƵůĂƚŽƌKĨŐĞŵƚŽ

ĂƐŬŚĂƌĚƋƵĞƐƟŽŶƐ͘

dŚĞŵĞĚŝĂĐŽǀĞƌĂŐĞƐŝŶĐĞŵĂLJŚĂǀĞďĞĞŶ

ƵŶŚĞůƉĨƵůĨŽƌĂĐŽŵƉĂŶLJǁŚŝĐŚŝƐƌĞƐƉŽŶƐŝďůĞĨŽƌ

ŬĞĞƉŝŶŐƚŚĞůŝŐŚƚƐŽŶ͘zĞƚŝŶŝŶǀĞƐƚŵĞŶƚŵĂƌŬĞƚ

ƚĞƌŵƐ͕ƚŚĞƐŚĂƌĞƉƌŝĐĞďĂƌĞůLJďůŝŶŬĞĚ͕ĨĂůůŝŶŐϭ͘ρй

ŝŶƚŚĞŝŵŵĞĚŝĂƚĞĂŌĞƌŵĂƚŚ͕ůŽƐƐĞƐƚŚĂƚŚĂǀĞ

ďĞĞŶĐŽŵƉůĞƚĞůLJƌĞĐŽǀĞƌĞĚƐŝŶĐĞ͕ǁŝƚŚŵŽĚĞƐƚ

ŐĂŝŶƐƚŽƐƉĂƌĞ͘

dŚĂƚĐŽƵůĚĐŚĂŶŐĞŝĨKĨŐĞŵ͛ƐŽĸĐŝĂůƉƌŽďĞ

ĞŶĚƐƵƉŵĞĂŶŝŶŐĂŚĞŌLJĮŶĞĨŽƌƐŚĂƌĞŚŽůĚĞƌƐ

ƚŽƐƚŽŵĂĐŚ͕ĂůƚŚŽƵŐŚEĂƟŽŶĂů'ƌŝĚ͛ƐƋƵŝĐŬ

ƌĞƐƉŽŶƐĞĂŶĚĞdžƉůĂŶĂƟŽŶƚŽĚĂƚĞƐĞĞŵƐƚŽ

ĞĂƐĞƚŚĂƚƚŚƌĞĂƚ͘

ƐŝĚĞĨƌŽŵƚŚŝƐŬĞƌĨƵŋĞƚŚĞďŝŐŝƐƐƵĞƐĨĂĐŝŶŐ

ƚŚĞŐƌŽƵƉĂŶĚŝŶǀĞƐƚŽƌƐƌĞŵĂŝŶƚŚĞƐĂŵĞ͖

ĚŝǀŝĚĞŶĚƐƵƐƚĂŝŶĂďŝůŝƚLJŝŶůŝŐŚƚŽĨŵŽƌĞŚĂǁŬŝƐŚ

ƌĞŐƵůĂƚŽƌĚĞŵĂŶĚƐĂŶĚůŽŶŐĞƌͲƚĞƌŵ͕ƚŚĞƚŚƌĞĂƚŽĨ

ŶĂƟŽŶĂůŝƐĂƟŽŶŝŶĂŶLJĨƵƚƵƌĞ>ĂďŽƵƌŐŽǀĞƌŶŵĞŶƚ͘

YƵŝƚĞŚŽǁĂŶLJŽĨƚŚŝƐǁŝůůƉůĂLJŽƵƚŝƐŝŵƉŽƐƐŝďůĞ

ƚŽƐĂLJƌŝŐŚƚŶŽǁďƵƚůŽŽŬŝŶŐĂƚƚŚĞƐƚŽĐŬŵĂƌŬĞƚ

ƚĞĂůĞĂǀĞƐƐƵŐŐĞƐƚƐŶŽŶĞĞĚĨŽƌƉĂŶŝĐ͘

NATIONAL GRID

(NG.) 864.3p

PRUDENTIAL

(PRU) £14.

Gain to date: 0.9%

Original entry point:

Buy at 856.5p, 15 November 2018

Loss to date: -9.7%

Original entry point:

Buy at £15.64, 4 April 2019

SHARES SAYS: È

Analysts see this year’s annual dividend to 31 March

2020 increasing by roughly 3% to 48.79p per share

implying a 5.65% yield, with similar incremental

gains forecast for 2021 and 2022.

SHARES SAYS: È

Despite the turbulence we believe investors should

stay in the course. Moving closer to the demerger

should focus attention on the value and potential

of both entities.

1350

1450

1550

1650

1750

1850

PRUDENTIAL

2018 2019

740

780

820

860

900

NATIONAL GRID

2018 2019