From Citywire on 30/03/16:
"RSA a safe bet with ?some opportunity?
RSA (RSA) has set ambitious new targets for its margins after Zurich pulled out of a bid for the insurer.
Deutsche Bank analyst Oliver Steel retained his ?hold? recommendation and upped his target price to 515p from 450p.
The shares rose 1.2% to 472.7p yesterday.
?The aborted offer from Zurich last year appears to have galvanised RSA?s profit improvement initiatives, and management has now set ambitious new targets to deliver margins in line with the best of its peers in its main markets,? he said.
?We think a good deal of this is achievable, and our forecasts for 2018 estimates are c.30% into the new target ranges, giving a price/earnings ratio in 2018 of 9.7x. Against this, we think continued balance sheet restructuring limits the dividend-paying ability for the next two to three years, leaving the yield trailing most of its peers even by 2018. In short, we see RSA as a relatively safe place while markets are volatile, with some opportunity, but we?d prefer a cheaper entry point than here.? "