Insights

IAG (ASX:IAG) share price falls as competitor raises $200 million

Can the company’s shares stage a rebound?
The post IAG (ASX:IAG) share price falls as competitor raises $200 million appeared first on The Motley Fool Australia. –

The Insurance Australia Group Ltd (ASX: IAG) share price is in reverse today following a string of developments from a major competitor.

At the time of writing, the insurance giant’s shares are down 1.75% to $5.32. In comparison, the S&P/ASX 200 Index (ASX: XJO) is also down 0.94% to 7,511 points.

What’s going on with the IAG share price?

Investors are selling IAG shares today after news out of a rival insurance group.

Yesterday, Steadfast Group Ltd (ASX: SDF) reported solid results for the FY21 period, highlighting an increase across the board. This was driven by the company’s pursuit of both organic and acquisition strategies.

In addition, Steadfast today announced it had successfully completed a capital raise of $200 million to further expand its presence. Coverforce, Australia’s largest unlisted insurance broker, will become a part of Steadfast, cementing its strong market position.

With IAG’s competitor growing at a rapid pace, it’s possible market share could be taken away.

Just last week, IAG released its full-year results for FY21 to the ASX. The company reported underlying insurance margins down 130 basis points to 14.7%. This led to insurance business recording a net loss after tax of $427 million. The IAG share price ended the day down 2.7%.

However, management appears optimistic for the future heading into FY22. IAG managing director and CEO Nick Hawkins commented:

…The strength of our core business and its sound underlying performance in FY21, our new operating model with clear, embedded executive responsibilities, as well as greater certainty in the economic outlook, mean that we are confident that IAG’s underlying performance will continue to improve.

How have IAG shares tracked lately?

Over the past 12 months, IAG shares have moved in circles, up 5% higher, with year-to-date gain sitting at 12%.

The company’s share price is currently above the middle of its 52-week range of $4.30 to $5.51.

Based on valuation grounds, IAG commands a market capitalisation of around $12.8 billion, with more than 2.4 billion shares outstanding

The post IAG (ASX:IAG) share price falls as competitor raises $200 million appeared first on The Motley Fool Australia.

Should you invest $1,000 in IAG right now?

Before you consider IAG, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and IAG wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

How does the IAG (ASX:IAG) dividend compare to its sector?
August has been a good month for the IAG (ASX:IAG) share price
CBA’s bumper profit, IAG’s loss and Telstra expectations. Scott Phillips on Nine’s Late News

ASX 200 rises, CBA climbs after FY21 report, Iress jumps

The ASX reporting wrap-up: CBA, Mineral Resources, IAG

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Insurance Australia Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
Trade The US Market With ZERO Brokerage* + FREE Access To Trading Ideas & Value Analysis Tools. Click Here!