AUB Austbrokers

[donnie]

Aub looks to have a lot of upside to go yet.

Austbrokers maintains earnings guidance
Email Print Normal font Large font November 8, 2006 - 11:10AM

Austbrokers Ltd has stuck to its annual earnings guidance of achieving five to ten per cent profit growth in fiscal 2007, despite a subdued insurance market.

The insurance broker said the market had been soft last year and is unlikely to pick up in the short-term, perhaps not even until the end of calendar 2007.

Last year Austbrokers posted a 47 per cent lift in net profit to $18.11 million.

Austbrokers said it expects further consolidation in the broker market and said opportunities for it to make more acquisitions will arise throughout the year.

© 2006 AAP

[directx]

What's your position?

[mark100]

AUB - Insurance broker

1. Forecasting yet another year of increasing earnings, rare in this market
2. Always seems to beat its forecasts
3. Will benefit from the firming of insurance premiums that the likes of QBE have been talking about
4. No insurance risk, only takes a commission
5. Conservative gearing, good cash flow
6. Valuation now looks attractive after getting ahead of itself the past couple of years, PE approx 10

Have a small holding, acquired sub $3.50

[mark100]

A boring stock that has finally made a break above $4. Good report expected, one of the few companies that will be reporting earnings growth

[mark100]

This boring but reliable stock seems to be slowing breaking higher. As an owner of insurance brokerages, AUB earns a commission of insurance premiums. I have a feeling insurance premiums around Australia will be rising to cover the cost of all the disasters that have occured.

AUB has increased earnings each year during the 6 years they have been listed. Earnings downside is also fairly limited as insurance is usually the last things to be cancelled in a downturn. Also AUB does not wear insurance risk.

[POSSUM THE CAT]

Mark 100 it could also go the other way & commissions actually reduce to lessen the increase in premium rates. Also discounts for direct customers could be a possibility.

[mark100]

Very good result from AUB with earnings increasing a better than expected 20%. Full year forecast also increased

This is a very reliable (and also a little boring) stock. Not one for the traders.

Possum, your comments are taken on board. Management seem upbeat for the time being anyway.

[mark100]

Not many companies making all time highs at the moment but AUB is. I still hold this one

[mark100]

Another great result. As I have said before this is a boring stock but it always delivers. Insurance broking is a consistent business

It's not cheap but the valuation isn't so bad if you adjust for the ammortisation. Given their investments in broking businesses appreciate in value over time the concept of ammortising their value is accounting gone mad in my view