Aviva & Wealthify: Company performance analysis

The below table shows insider transactions over the past month. The majority of transactions over the period have been share purchases, with just one exception. This tends to be a good indiciation of the financial health and prospects of a company.

• Pippa Lambert – Non-Executive, Director
  Uninformative Buy, Auto Buy – 1,002 shares
• Thomas Neil Morrison – Non-Executive, Director
  Uninformative Buy, Auto Buy – 100,000 shares
• Mark Versey – Subsidiary Chief Executive Officer
  Uninformative Buy, Auto Buy – 54 shares
• Doug Brown – Divisional Chief Executive Officer
  Uninformaive Buy, Auto Buy – 53 shares
• James Hillman – Chief Risk Officer
  Uninformative Buy, Auto Buy – 51 shares
• James Hillman – Chief Risk Officer
  Uninformative Buy, Grant/Award/Other Acquisition – 41,596 shares
• James Hillman – Chief Risk Officer
  Informative Sell, Options Exercised and fully Sold – 19,599 shares
• Cheryl Agius – Non-Executive, Director
  Uninformative Buy, Auto Buy – 15,000 shares

Aviva doesn’t widely publish data concerning its Assets Under Administration (AUA) within different parts of the business. In a recent interview, however, Doug Brown, CEO of Aviva Insurance, Wealth & Retirement, noted that Aviva’s platform assets have increased to £55.1 billion as of Q2 of 2024, up from £47.3 billion the previous year. This growth includes figures from Succession Wealth, a national advice arm that Aviva acquired in 2022.

The broader wealth business is a significant part of Aviva’s operations, with total AUA reaching £398 billion as of June 2024.

Number of users vs previous year and quarter.
Aviva doesn’t publish an exact breakdown of its customer numbers. The company currently boasts more than 19 million clients worldwide and says 4.9 million UK customers have more than one policy with them.

Revenue vs previous year vs consensus estimates.

In 2023 the group started providing revenue figures from its wealth business. In 2023, the business segment generated revenues of £620 million, up 11% year-over-year. This figure is slightly behind Hargreaves Lansdown, the UK’s largest investment platform provider.

Operating profit versus previous year.

According to data published online, Barclays Investment Solutions is a loss making business with an operating loss of £71.5m in 2023. That’s up from 838,000 in 2022.

Operating profit versus the previous year.

Aviva’s adjusted operating profits – for the business as a whole – are down from 2020 despite improving sentiment surrounding the business. The company has set an operating profit target of £2 billion by 2026. In 2023, the business reported an operating profit of £1.47 billion.

Earnings per share (EPS) vs previous year vs consensus estimates.

Like many insurers, Aviva faced headwinds following the pandemic as inflation ticked upwards putting upward pressure on claims. The business posted two consecutive years of losses but returned to positive territory in 2023. Analysts are expecting earnings per share (EPS) of 47.22p in 2024, a strong showing compared with recent years.

Return on Equity vs previous year and quarter.

Return on Equity (RoE) is a useful way to assess an insurer’s financial strength by showing the relationship between the company’s operating results and its equity. The above chart shows that after a period of decline, RoE is once again in positive territory.

Expense ratio vs previous year vs consensus estimates.

The expense ratio measures the insurer’s operating expenses as a percentage of premiums earned, and a lower ratio indicates more efficient operations. The above chart shows that the expense ratio was highest in 2023, indicating less efficient operations than in earlier years.

Net operating cash flow vs previous year vs consensus estimates.

Net operating cash flow is a key indicator of the health of an insurance business. Interestingly, net operating cash flow hasn’t followed a similar trajectory to earnings.

Analysts’ price targets and ratings including commentary.

Based on 13 analysts offering 12-month price targets for Aviva in the last 3 months. The average price target is 534.31p with a high forecast of 584 and a low forecast of 435.