Prudential PLC's Shift in Embedded Value Methodology Prompts Different Reactions -- Market Talk

Dow Jones09-04

1214 GMT - The market reaction to Prudential PLC's proposal to adopt traditional embedded value, or TEV, and shift away from European embedded value, EEV, was surprising, Jefferies writes, referring to a metric used by life insurers to measure the value of shareholder's interest. Most analysts have argued that a TEV valuation would prompt upside, even if the insurer has historically been reluctant to the shift as EEV is arguably closer to the economic reality, analysts say. Jefferies questioned the benefits of such shift given the time and costs involved. "As such, despite the difference between TEV and EEV being roughly in line with expectations (circa -20% to -25%), we were disappointed to find that some participants now suggest that the tangible TEV per share ought to be viewed as a ceiling on the share price," analysts add. London shares fall 2.3%. (elena.vardon@wsj.com)

(END) Dow Jones Newswires

September 04, 2024 08:14 ET (12:14 GMT)

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