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1. Company Snapshot

1.a. Company Description

NN Group N.V., a financial services company, primarily provides life insurance products in the Netherlands and internationally.The company operates through Netherlands Life, Netherlands Non-life, Insurance Europe, Japan Life, Banking, and Other segments.It offers group and individual life insurance, and pension products; non-life insurance products, including motor, fire, liability, transport, travel, and disability and accident insurance; employee benefits, and health insurance products; corporate-owned life insurance products; and single premium variable annuity individual life insurance products.


The company also provides banking services, including mortgage loans, online savings accounts, bank annuities, consumer lending, and retail investment products, as well as administration and management services; reinsurance services; and retirement products and services.It offers its products to individuals, small and medium-sized enterprises, retail customers, and institutional customers directly, as well as through tied agents, bancassurance partners, brokers, and direct channels.The company was formerly known as ING Insurance Topholding N.V. and changed its name to NN Group N.V. in March 2014.


NN Group N.V. was founded in 1845 and is headquartered in the Hague, the Netherlands.

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1.b. Last Insights on NN

NN Group N.V.'s recent performance was driven by robust capital generation and dividend growth, as reported in its FY 2024 earnings release. The company successfully navigated regulatory and market headwinds, demonstrating its resilience. Strong financial performance was highlighted, with a focus on generating value for shareholders. Additionally, the company's ability to grow dividends is a positive sign, indicating a commitment to returning value to investors.

1.c. Company Highlights

2. NN Group Delivers Strong Financial Performance with Robust Capital Generation and Strategic Progress

NN Group reported a stellar financial performance in its full-year 2024 results, underscored by a significant increase in operating capital generation and free cash flow. The company generated €1.9 billion in operating capital, aligning with its 2025 target, and saw an 8% rise in free cash flow to €1.5 billion, which is on track to meet the 2025 target of €1.6 billion. The solvency ratio stood at a robust 194%, within the upper range of the company's 150-200% target, reflecting a strong balance sheet and effective risk management. These results highlight NN Group's ability to deliver on its financial commitments while navigating market and regulatory challenges.

Publication Date: Feb -26

📋 Highlights
  • Strong Financial Performance:: NN Group delivered robust full-year 2024 results, with operating capital generation reaching €1.9 billion, aligning with its 2025 target. Free cash flow rose 8% to €1.5 billion, supporting the 2025 target of €1.6 billion.
  • Robust Solvency and Balance Sheet:: The group solvency ratio stood at 194%, within the upper range of 150-200%, reflecting a robust balance sheet. Real estate valuations improved, particularly in residential, supported by favorable court rulings.
  • Commercial Momentum:: Commercial performance was strong, with a 20% year-over-year increase in new business value, driven by European sales and Dutch pension buyouts. Netherlands Life reported a €2.3 billion net inflow in defined contributions, while Non-life segments saw a 4.5% growth in written premiums.
  • Shareholder Value Focus:: NN Group announced a final dividend of €3.44 per share, an 8% increase, and a €300 million share buyback, reinforcing its commitment to capital return policy and shareholder value creation.
  • Strategic Progress and Sustainability:: The company advanced its strategic KPIs, including a 31% reduction in corporate investment portfolio emissions since 2021 and €12.8 billion invested in climate solutions. Community investments supported over 766,000 individuals since 2022, demonstrating progress in sustainability and social impact.

Commercial Performance and Strategic Initiatives

Commercial performance was a standout, with a 20% year-over-year increase in new business value, driven by strong European sales and Dutch pension buyouts. The Netherlands Life segment reported a €2.3 billion net inflow in defined contributions, while Netherlands Non-life saw a 4.5% growth in written premiums. These figures underscore the company's ability to capitalize on market opportunities and execute its growth strategy effectively. NN Group also made significant progress in its strategic KPIs, including enhancing customer experience through AI tools and achieving a strong net promoter score in international markets.

Sustainability and Community Investments

Sustainability remained a key focus for NN Group, with a 31% reduction in corporate investment portfolio emissions since 2021 and €12.8 billion invested in climate solutions by year-end. The company also made notable contributions to community investments, supporting over 766,000 individuals since 2022. These efforts highlight NN Group's commitment to environmental, social, and governance (ESG) principles and its role as a responsible corporate citizen.

Outlook and Strategic Positioning

Looking ahead, NN Group expressed confidence in its ability to deliver sustained performance driven by strong momentum in Insurance Europe and stable remittances from Netherlands Life. The company highlighted progress in strategic initiatives such as derisking actions, which improved solvency by 5 percentage points, and plans to accelerate pension buyouts, with €1.7 billion closed in 2024 and a potential €2.5 billion in 2025. CFO Annemiek van Melick emphasized the company's disciplined approach to capital management and its commitment to delivering shareholder value through a combination of dividends and share buybacks.

Valuation Analysis

In conclusion, NN Group's strong financial performance, robust balance sheet, and strategic progress position it well to deliver on its long-term objectives. The company's focus on sustainability and commitment to shareholder value further enhance its appeal to investors. While some risks remain, particularly in the Dutch long-term disability market and pension buyout timing, NN Group's disciplined approach to capital management and growth initiatives provide a solid foundation for future success.

3. NewsRoom

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Institutions own 47% of NN Group N.V. (AMS:NN) shares but retail investors control 48% of the company

Sep -15

Source:

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Take the Zacks Approach to Beat the Markets: AngloGold Ashanti, Caterpillar & Hershey in Focus

Jul -28

Source: zacks.com

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Zacks Industry Outlook Highlights AIA, Manulife Financial, Sun Life Financial, Aviva and NN Group

Jun -25

Source:

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5 Life Insurance Stocks to Watch in a Steady Interest Rate Environment

Jun -24

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Institutional owners may ignore NN Group N.V.'s (AMS:NN) recent €806m market cap decline as longer-term profits stay in the green

Apr -07

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NN Group (NNGRY) Upgraded to Strong Buy: What Does It Mean for the Stock?

Apr -02

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Zacks Industry Outlook Highlights Aviva, NN Group, Jackson Financial and Abacus Global Management

Apr -02

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4 Stocks to Watch From a Prospering Life Insurance Industry

Apr -01

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.40%)

6. Segments

Netherlands Life

Expected Growth: 6.5%

Netherlands Life from NN Group N.V. achieved 6.5% growth driven by increasing demand for retirement and pension products, favorable interest rates, and a strong brand presence. Additionally, the segment benefited from cost savings initiatives, improved operational efficiency, and a growing middle-class population seeking life insurance and investment products.

Netherlands Non-life

Expected Growth: 6.2%

The 6.2% growth in Netherlands Non-life from NN Group N.V. is driven by a strong economy, increasing disposable income, and a growing demand for insurance products. Additionally, the segment benefits from a favorable regulatory environment, investments in digitalization, and a robust claims management process, leading to improved customer satisfaction and retention.

Insurance Europe

Expected Growth: 6.8%

NN Group N.V.'s Insurance Europe segment growth of 6.8% is driven by increasing demand for life insurance and pension products, expansion in Central and Eastern Europe, and a strong capital position enabling strategic investments. Additionally, the segment benefits from a diversified distribution network and a robust risk management framework, supporting sustainable growth.

Banking

Expected Growth: 5.5%

NN Group N.V.'s 5.5% growth in banking is driven by increasing demand for digital banking services, expansion into new markets, and strategic partnerships. Additionally, the company's focus on cost savings, investments in technology, and improvement in operational efficiency have contributed to its growth. Furthermore, the growth is also attributed to the rise in mortgage lending and strong performance in the Dutch retail banking market.

Japan Life

Expected Growth: 5.8%

Japan Life from NN Group N.V. growth of 5.8% driven by increasing demand for life insurance products, favorable demographics, and a growing middle class. Additionally, the Japanese government's efforts to promote private pension plans and the increasing popularity of online insurance platforms contribute to the segment's growth.

Other

Expected Growth: 6.0%

NN Group N.V.'s 6.0% growth is driven by increasing demand for insurance and asset management services, expansion into new markets, and strategic acquisitions. Additionally, the company's focus on digitalization, cost savings initiatives, and strong capital position have contributed to its growth momentum.

7. Detailed Products

NN Investment Partners

NN Investment Partners is the asset management arm of NN Group, offering a range of investment solutions to institutional clients, wholesale investors, and retail investors.

NN Life Insurance

NN Life Insurance provides a range of life insurance products, including term life, whole life, and universal life insurance, to individuals and groups.

NN Non-Life Insurance

NN Non-Life Insurance offers a range of non-life insurance products, including motor, home, and liability insurance, to individuals and businesses.

NN Pensions

NN Pensions provides a range of pension products and services, including defined contribution and defined benefit plans, to individuals and employers.

NN Banking

NN Banking offers a range of banking products and services, including current accounts, savings accounts, and mortgages, to individuals and businesses.

NN International Insurance

NN International Insurance provides a range of international insurance products, including expat insurance and international health insurance, to individuals and groups.

8. NN Group N.V.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for NN Group N.V. is medium due to the presence of alternative investment products and services offered by other financial institutions.

Bargaining Power Of Customers

The bargaining power of customers is low due to the lack of concentration of buyers in the market, and the high switching costs associated with changing financial institutions.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium due to the presence of a few large suppliers of technology and services, but the company has some flexibility in choosing its suppliers.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the financial services industry, including regulatory requirements and capital requirements.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of many established players in the market, and the need to constantly innovate and differentiate products and services to remain competitive.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 43.78%
Debt Cost 8.07%
Equity Weight 56.22%
Equity Cost 8.07%
WACC 8.07%
Leverage 77.88%

11. Quality Control: NN Group N.V. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Aviva

A-Score: 7.5/10

Value: 6.5

Growth: 5.4

Quality: 5.7

Yield: 9.4

Momentum: 9.0

Volatility: 9.3

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Grupo Catalana Occidente

A-Score: 7.3/10

Value: 8.1

Growth: 4.3

Quality: 7.8

Yield: 5.6

Momentum: 8.0

Volatility: 10.0

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ASR Nederland

A-Score: 7.1/10

Value: 5.7

Growth: 4.1

Quality: 6.2

Yield: 8.8

Momentum: 8.0

Volatility: 9.7

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UNIQA

A-Score: 7.1/10

Value: 6.3

Growth: 3.6

Quality: 6.2

Yield: 8.1

Momentum: 9.5

Volatility: 8.7

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Unipol Gruppo

A-Score: 7.0/10

Value: 6.6

Growth: 3.7

Quality: 6.6

Yield: 8.8

Momentum: 9.0

Volatility: 7.3

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NN Group

A-Score: 6.8/10

Value: 4.3

Growth: 3.3

Quality: 7.2

Yield: 8.8

Momentum: 8.0

Volatility: 9.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

62.5$

Current Price

62.5$

Potential

-0.00%

Expected Cash-Flows