Swiss Re AG <SRENH.S>: JP Morgan cuts target price to CHF 135 from CHF 145

Swiss Re AG (SRENH.S) has seen its price target cut by J.P. Morgan, which reduced its target for the stock to CHF 135 from CHF 145, reflecting a revised outlook on the company’s valuation and performance relative to its peers. The downgrade aligns with broader concerns about the reinsurance sector, where J.P. Morgan anticipates a prolonged softening cycle extending into 2026. The firm cited Swiss Re’s current valuation as having caught up with its European counterparts, despite the company’s improved resilience and successful restructuring efforts.

The move follows Swiss Re’s recent USD 700 million stop-loss transaction with J.P. Morgan, which aims to provide protection against severe underwriting losses and supports the company’s growth strategy. However, J.P. Morgan analysts argue that Swiss Re’s valuation no longer offers a compelling value proposition compared to Hannover Re and Munich Re, both of which retain Overweight ratings.

Analysts also noted that Swiss Re’s share price currently trades at a slight premium to Munich Re and a marginal discount to Hannover Re, a positioning they believe is not justified given the consistent performance by its rivals. The firm expects Swiss Re to resume a $1 billion share buyback program after fiscal 2025 results, but for now, it has paused its recommendation due to valuation concerns.