Novae’s shares slump after catastrophe losses warning
Losses include exploding SpaceX rocket, two product recalls, Hurricane Matthew, the New Zealand earthquake, and delays at Tullow Oil’s Jubilee oil field in Ghana
London — Lloyd’s of London insurer Novae Group said on Thursday larger individual risk and catastrophe losses in the year would lead to its full-year underwriting contribution being lower than it expected, sending its stock plunging. Shares in Novae slumped as much as 21.6% on Thursday, and were poised for their biggest single-day fall in more than 12 years. Analysts pointed to losses from interrupted production at Tullow Oil’s flagship Jubilee oil field in Ghana, a SpaceX rocket which burst into flames and destroyed a $200m satellite owned by Israel’s Space Communication Ltd, two product recalls, Hurricane Matthew and the New Zealand earthquake. "We believe it has been a bad, but not exceptional, year for large losses at an industry level. Novae is likely more exposed than quoted Lloyd’s peers due to its narrower scope of business," Canaccord Genuity analysts said. The brokerage downgraded Novae’s stock to a "hold" from a "buy" rating and cut 2016 EPS estimates 40%. Novae, which co...
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