[Click eStock] "Buy Strategy for Insurance Stocks Valid if Further Adjustment Occurs"

Hana Securities stated on the 26th that regarding the insurance sector, "Stocks that can be expected to provide sufficient shareholder returns compared to the current stock price level will not undergo significant corrections in the future," adding, "Therefore, any further corrections should be approached from a buying perspective."

On the same day, analyst Ahn Young-jun of Hana Securities said, "If companies announce share buybacks and cancellations, there will be additional upward momentum, and with market interest rates falling compared to last year, the advantage of dividends has increased."

This week, securities stocks fell by 4.9%, underperforming the KOSPI volatility. Analyst Ahn explained, "Although the securities sector stock prices showed an upward trend reflecting expectations for the recent Q2 earnings, concerns over decreased trading volume due to domestic and international market adjustments and the authorities' tough stance on real estate project financing (PF) led to a correction in securities stocks."

He explained, "To understand the current stock price level from the perspective of shareholder return rates, one should check last year's shareholder return yield and this year's shareholder return growth rate."

Before the value-up program attracted market attention, the dividend yields of insurance companies before the ex-dividend date last year were 5.1%, 5.4%, 6.2%, 6.4%, 6.7%, and 4.9% for Samsung Life Insurance, Hanwha Life Insurance, Samsung Fire & Marine Insurance, DB Insurance, Hyundai Marine & Fire Insurance, and Hanwha General Insurance, respectively. Considering earnings and capital ratios, this year's shareholder return growth rate is expected to be 20% for life insurers and 15-25% for non-life insurers compared to last year.

Analyst Ahn said, "It will be difficult to restrict insurance companies' dividends due to regulatory issues while the value-up program is underway," adding, "Therefore, the expected dividend yields for this year at the current stock price levels are expected to be similar to or slightly exceed last year's dividend yields, with Samsung Life Insurance, Hanwha Life Insurance, Samsung Fire & Marine Insurance, DB Insurance, Hyundai Marine & Fire Insurance, and Hanwha General Insurance at 4.9%, 6.1%, 5.8%, 6.2%, 7.1%, and 4.6%, respectively."

He selected Samsung Life Insurance as the preferred stock for the week. Analyst Ahn said, "It maintains a stable capital ratio, has a small number of retroactive years, and continues solid new contract performance," adding, "Additional capital ratio increases and expanded shareholder returns are expected by year-end, and despite recent stock price increases, the expected dividend yield remains historically high."