ALLIANZ

Analysis of Allianz share price

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The Allianz group was still fairly unknown in a number of European countries until fairly recently, but due to international success and a number of acquisitions, this company is now very well known and is traded on the Euronext stock market. Nowadays, the online banks and the online brokers and trading platforms enable individual traders to invest in this company’s shares.

Latest news

Allianz remains optimistic about its 2021 outlook

17/08/2021 - 08h10

German insurer Allianz is showing great optimism in its annual forecast for the current full year. This follows strong results unveiled for the first half of 2021

Elements that can influence the price of this asset:

Analysis N°1

This notably concerns the geographical expansion strategy of the company that has tried to expand from the basic European market into the highly popular emerging countries over the last few years. 

Analysis N°2

It is clear that concerning the diversification of the group’s products, although the range of solutions offered by Allianz is already extremely comprehensive it would be advantageous for the group to investigate new market sectors where it is not yet present. 

Analysis N°3

As with all large insurance companies, the Allianz group and its profits are of course highly exposed to certain exterior factors that it cannot control. This notably concerns natural catastrophes that lead to higher costs in payouts that can have major consequences for this company’s share price.

Analysis N°4

Allianz has also had to combat a growing number of frauds over the last few years that has resulted in financial losses for the group. It is therefore important to monitor the implementation of actions by this group to effectively fight this phenomenon. 

Analysis N°5

Finally, it is clear that the financial and economic health of Europe and its member countries wherein Allianz proposes its products has a major impact on the growth of this company. All the general data relating to the purchasing power and therefore the ability of consumers to avail themselves of new products and services in this sector are true indicators of the possibilities of Allianz to increase its revenue.

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General presentation of Allianz

Let us first look at the German Allianz group that issues shares under the same name, and its activity. 

The Allianz group is actually one of the leaders in the insurance sector on a global level. However it also offers traditional banking activities. In detail, the life and health insurance activities represent over 54% of the total turnover figures of this company. Then follow the non-life insurance activities of 39%, and asset management which represents around 5.2% of the total turnover. The remaining amount corresponds to banking and management activities for themselves. 

The Allianz group currently has more than 147,425 employees throughout the world. It was in 2004 that the shares of the Allianz Company were first offered to the public on the European Euronext stock market. It should be noted that this company has also been part of the DAX 30 stock index for a few years now.

To understand the mechanics that have caused rising or falling movements in the Allianz share price, it is helpful to look at the economical history of this company. Here therefore are a few key dates to remember:

  • Between 1990 and 2000 the Allianz Company has strongly developed in the international sector with an expansion into Eastern Europe and the acquisition of the Fireman’s Fund Insurance Company in the United States for 3.3 billion dollars in 1990 and AGF in 1998 thereby making Allianz the European leader in this activity sector. In parallel to this, in the year 2000, Allianz developed strategic alliances in Asia and particularly in China with targeted investments that developed its activity on this continent.
  • Again in the year 2000 Allianz shares were introduced onto the American NYSE (New York Stock Exchange). They were removed in 2008.
  • In 2001 Allianz purchased Dresdner Bank which it then sold to Commerzbank with a participation stake and despite a major undervaluation.
  • In 2005 Allianz inaugurated the Allianz Arena, a football stadium in Munich that has since become famous.
  • In 2006 the Allianz Group became the first company to adopt the special status of ‘Societas Europaea’.
  • In 2014, Allianz recorded a slight drop in its net profits in the first quarter but held its leading position against its principal competitor Axa. The group then adopted a new sales strategy aimed at re-adapting insurance by creating others and offering new options for retired contracts. This was with the aim of recovering this fall in profits of nearly 3%. A successful attempt as the following financial results were far superior to those expected.
  • In 2016 the activities of Allianz in South Korea were purchased by Anbang.
Analysis of Allianz share price
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The major competitors of Allianz

To know the Allianz share well and promote your analyses of this stock, you must make sure that you know its main competitors on the market. This is what you'll find with a quick overview of the direct adversaries of this group at the moment:

AIG

This Company is also known as American International Group Inc. and is currently one of the leaders in insurance and financial services around the world. The group now employs over 56,000 people and no less than 90 million customers in around 100 countries and jurisdictions. Bear in mind that AIG has been the most widely established American insurance company in Europe for nearly 65 years.

AON

This other company is a British multinational this time and one of the leaders in certain areas of insurance including risk management, insurance brokerage and reinsurance, human resources counselling and management and subscription of specialized insurance. The company's headquarters are currently based in London and AON also has a major decision-making centre in Chicago. Currently, AON employs more than 50,000 people in more than 500 offices in 120 countries around the world.

AXA Group 

This French international group is another direct competitor of Allianz. It specializes in insurance and asset management and targets both individuals and businesses by offering insurance, provident, savings and wealth transmission products and services as well as banking activities in certain countries. The French group AXA is also one of the largest insurance companies in the world alongside Allianz and is the world's leading insurance brand as well as the third brand in the financial services industry internationally.

MetLife

This Company also known under the name of Metropolitan Life Insurance Company is an American company specializing in the insurance sector and which offers borrower insurance and provident guarantees for individuals and professionals and intermediaries such as brokers as well. It is one of the largest global insurance providers with more than 90 million customers in nearly 60 countries around the world. The MetLife group has numerous subsidiaries all over the world and regularly establishes international partnerships.


The major partners of Allianz

The Allianz Group has also based part of its market conquest strategy on well thought out and well negotiated partnerships. This is the case for example with a partnership signed with the Ford automobile manufacturing company in 2014 for a 5 year period for the specific distribution of automobile insurance.

SNCF

 On the same principle, Allianz has partnered for several years with the French SNCF Company to offer travel insurance to clients of this group.

Uber

More recently, Allianz has also signed a partnership agreement with the Uber VTC Company and has thereby become the official insurance supplier of driver networks thus increasing its market share at the same time.

Sporting events

Apart from these partnerships with major international companies, Allianz often collaborates on large sporting events which enables the company to benefit from a positive brand image and significant advertising worldwide.

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The factors in favour of a rise in the Allianz share price:

If you are among the investors interested in the best German stocks and want to invest some of your funds on Allianz’s shares, your investment target will largely depend on the strengths and weaknesses of this company. To help you see more clearly, here is a summary of the main strengths of this share.

One of the main strengths of Allianz shares, is of course, the strong brand image of this company which is known by the public throughout Europe and not only in Germany. This notoriety is of course due to a strong and well thought marketing communication, but also to the recent diversification of the services the company offers.

Allianz is mostly known for its life insurance and credit services. This is another of its strengths since the company is currently the undisputed leader of this market in Europe and puts a little more distance between them and their main competitors each year.

Allianz also counts with an extremely strategic geographical position thus it offers its products and services in many countries and is particularly well positioned in each of them. Through its several agencies, the group currently employs more than 150,000 people around the world and counts with an international expansion strategy that will probably enable it to continue expanding.

The factors in favour of a drop in the Allianz share price:

Of course, as you can imagine, Allianz does not only offer advantages regarding stock market investment. Before you start speculating on this action online, you have to know the weak points of this company and be able to use them to your advantage with an adapted strategy. We invite you, to discover some of the flaws of this value and the problems that the German company Allianz could encounter in the years to come here.

First of all, it is important to remember that most of the insurance and financial activities proposed by the company concern the automobile industry, whether destined to particulars or professionals. Also, the company is strongly exposed to the economic health of this market as well as to the strong competition of the sector.

Even if Allianz has a rather positive brand image today, there have also been some controversies concerning the role that the company played during the second world war, a fact that has been slowing down its growth in some countries which were marked by this period and where the most discerning consumers are still skeptic about the entity.

Although Allianz is currently the leader in several sectors in the field of insurance in Germany as well as in the rest of Europe, we should not forget that the competition in this sector of activity is very strong and that other big European companies are also trying to gain notoriety in this market every day. It is therefore essential for the company to show strong competitiveness.

Finally, the slowdown of the company’s growth in recent years has become one of its weak points. Even if the outcome shows a certain stability, the movement of the growth observed since 2011 has a tendency to falter, which creates fear that the share could fall. Investors prefer to turn to shares that count with progression potential and incomes that are higher than that of Allianz. Let’s not forget that the company has historically often published results that have been below the expectations of the consensus, which has caused disappointment on the market and led to greater skepticism about the company.

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions.

Frequently Asked Questions

How is the capital of the Allianz Group divided?

At the time of writing this article, in June 2020, the capital of the Allianz Group was divided among a number of shareholders including  Norges Bank Investment Management with 2.98%, The Vanguard Group with 2.88%, DWS Investment with 2.54%, BNP Paribas Asset Management France with 1.42%, DWS Investments with 1.37%, Deka Investment with 1.24%, BlackRock Asset Management Deutschland with 1.14%, Harris Associates with 1.13%, Amundi Asset Management with 1.10% and FIL Investment Advisors with 0.99%.

Does the Allianz Group exercise lobbying activities?

The Allianz Group does of course exercise lobbying activities. In fact, this company has been registered since 2009 on the register of transparency of interests with the European Commission. For this activity the company declared an annual expenditure for 2018 of between 1,000,000 and 1,250,000 Euros. The lobbying figures for 2019 have not yet been released by the company at this point.  

How to make predictions on the Allianz share price?

If you wish to make precise predictions on the Allianz share price then you should take into account a technical analysis through a study of the historical stock market charts and the various price movements displayed. You should also complete a fundamental analysis of this asset at the same time taking into account the factors that are the most likely to exert an influence on this asset price.

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