November 9, 2018 / 7:20 AM / 7 days ago

BUZZ-IAG: RBC highlights buyback, discount on valuation

** RBC raises rating on Industrial Alliance Insurance to “outperform” from “sector perform”

** RBC sees Q3 results positively — core EPS better than expected, capital position remains solid (with room for capital deployment) and sizable buyback program

** RBC forecasts this momentum to continue through 2019 with expected profit and income on capital growth of 11 - 12 pct, respectively

** RBC says 2019 core EPS estimate would benefit by ~C$0.20 or ~3 pct and ROE would benefit by ~40 bps if co completes its large share buyback program over the next 4 quarters

** Says valuations are attractive on an absolute basis and relative to peers

** Stock down ~19 pct YTD

** Of 9 analysts covering the stock, 7 have “buy” or higher rating while 2 rate the stock “hold” - Refinitiv data

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