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Raymond James analyst Wilma Burdis upgraded Prudential Financial (NYSE:PRU) to Strong Buy from Market Perform on Thursday on expectations that the insurer will re-rate as it proves out its transformation strategy, as well as potentially boosting share buybacks.
“We see considerable margin for error, as PRU’s catalysts appear largely favorable, significant de-risking and reserving recently took place, and investors have been disappointed for a lengthy period,” Burdis wrote in a note to clients.
The sell-side analyst now reckons Prudential (PRU) next year could repurchase more than $2B worth of its stock, up from his prior expectation of $1.05B, “given its favorable capital position versus its target buffer.”
Some other positives driving Burdis’s upgrade, the note said, include the potential for PRU to dispose of more non-core operations and less mergers-and-acquisitions activity.
PRU gained 1.1% in premarket trading.
The Strong Buy rating aligns with the SA Quant system rating and the average SA analyst rating, both at Buy, and diverges from the average Wall Street analyst rating of Hold.
