Table of Contents
- Company profile – French insurance group
- AXA's latest quarterly figures from March 2025
- AXA stock forecast for 2025
- Evaluation of AXA stock
Within the industry, AXA (ISIN: FR0000120628) has positioned itself well as one of Europe's leading insurers with global reach and a broadly diversified business model. The French group is represented in all key segments – from property and life insurance to occupational pensions and asset management – and combines growth with capital discipline. From a fundamental perspective, there are several arguments in favor of AXA shares: an attractive valuation with a moderate P/E ratio, a dividend yield of over 5%, solid earnings growth, and consistent implementation of the corporate strategy. The “Unlock the Future” program aims to achieve profitable organic growth, technical excellence, and high capital efficiency. Investors are also betting on positive future development underpinned by solid growth. The share price has risen significantly over the past five years, as evidenced by a 125 percent increase. Even over 20 years, the increase is 113 percent.
Source: AXA share price performance since 2005
The following AXA stock analysis reveals exactly what is driving the current developments and whether investors can expect prices to continue rising. One thing is clear: things are looking good for the insurer – and there is plenty to be gained here, especially for dividend investors.
Company profile – French insurance group
AXA is a leading global insurance group headquartered in Paris, France. The company is one of the largest and most influential players in the global insurance and financial services industry. The French company operates in more than 50 countries and serves over 94 million customers worldwide. AXA has grown historically through mergers and strategic acquisitions.
Its most significant acquisitions include the Colonia Group, UAP (Union des Assurances de Paris) and Winterthur Insurance.
The group has a particularly strong presence in Europe, North America and the Asia-Pacific region. The largest single sales region remains its home market of France, which most recently accounted for more than a quarter of gross premium income. The AXA Group's business model is similar to that of its competitor Allianz and is based on a broad positioning in various areas of insurance and financial services. The Group's goal is to offer comprehensive protection and financial security to both private individuals and companies.
Source: AXA Annual Report 2024
A key segment of AXA's business model is Property & Casualty, i.e. property and accident insurance. In this segment, AXA offers insurance solutions to protect against damage to property and to cover liability claims. The company covers risks such as traffic accidents, fire, storm, and water damage, as well as operational liability risks. In 2024, this segment generated more than half of gross premium income, at over €56 billion.
Another key segment is Life & Health, which covers life and health insurance. With gross premium income of €52 billion in fiscal year 2024, it was similarly sized. Within this segment, AXA also differentiates between the Life and Health areas. In the Life segment, it focuses on products for retirement provision, capital accumulation, and protection for surviving dependents in the event of death. Life insurance products are increasingly being combined with investment and savings components to meet the growing need for individual asset planning. The Health segment comprises products that provide protection against medical expenses, long-term care, and disability. AXA positions itself here as a provider of both private health insurance and corporate health solutions.
Another key element of the business model is the Asset Management segment. This generated revenues of €1.7 billion in 2024. AXA manages the funds of institutional and private investors, including investments from its own insurance portfolios. Assets under management amounted to €879 billion in 2024. Through subsidiaries such as AXA Investment Managers and AllianceBernstein, the Group offers a wide range of investment solutions, ranging from traditional equity and bond funds to alternative investments. The segment is of strategic importance to AXA as it generates stable, commission-based income and opens up additional growth potential. AXA is also active in banking, although this part of the business model plays a minor role compared to the other segments. In 2024, for example, it generated revenues of only €118 million. The banking business focuses primarily on specific markets such as France and Belgium and includes services such as deposit management, lending, payment transactions, and investment advice. In combination with its insurance offerings, AXA thus creates integrated financial solutions for its customers.
Market and competition
In terms of the market, it is clear that the insurance and asset management market is highly competitive, characterized by significant consolidation and growing competitive pressure. Nevertheless, there are moats that are created not only by brands but also by customer relationships. Once you have taken out insurance, you usually have a contract with a term of several years. A group that can retain customers with a good risk profile and credit rating over the long term therefore has a real advantage.
Its main competitors include international corporations such as Allianz, Zurich Insurance, Generali, Munich Re and Prudential, as well as specialist providers such as Chubb and AIG in the industrial and reinsurance sectors. All of them have performed well in recent years, but AXA is one of the weaker players, having doubled its market capitalization over 20 years.
Source: Peer group comparison of AXA shares
Looking at revenues and profits over a period of 20 years, there is no particular upward momentum in the long term – except since the start of the coronavirus pandemic. Insurers are currently benefiting in particular from higher interest rates and inflation.
Higher interest rates enable better investment returns, which has a positive impact on profits in the life and health insurance business. At the same time, the higher interest rate environment reduces pressure on provisions for future liabilities, thereby easing the burden on balance sheets. In addition, the pricing environment is favorable in many insurance segments, especially in property insurance. Insurers can sell policies at higher premiums. This is being driven by general inflation, among other things, but also by increasing risks such as natural disasters and geopolitical uncertainties. This development is therefore ensuring rising revenues with stable or even improved margins. In addition, digitalization is driving efficiency gains. Automation, data-based risk management, and digital distribution channels are reducing operating costs and improving the customer experience. Taken together, all these factors are creating an environment in which many insurers can benefit from structural tailwinds despite global uncertainties.
Source: AXA peer group – comparison of revenues
The market is characterized by structural growth driven by demographic change, growing health and pension needs, and increasing risks such as climate change and geopolitical uncertainties. At the same time, digital transformation is forcing the industry to invest in technology, automation, and data-driven underwriting. Although there are a few insurtech companies, such as Lemonade, Root Insurance, Hippo, Next Insurance and WeFox from Germany, none have yet been able to steal the thunder of the big players. In this context, AXA benefits from its strong international positioning, diversified product range and clear strategic focus on technical excellence and high-margin business. Compared to its competitors, the group is also particularly focused on efficient capital management and risk-adjusted growth, and has a high dividend payout discipline. All these factors help the group to successfully assert itself in a challenging market environment.
AXA's latest quarterly figures from March 2025
A glance at the quarterly figures shows that these will only be published together with the half-year figures in August. There is no reporting at the quarterly level. However, there is a press release on the Q1 Activity Indicator. This shows that AXA started 2025 with a strong first quarter and is continuing the positive trend of the previous year. The Group recorded solid revenue growth in all business segments and continued to benefit from the disciplined implementation of its organic growth strategy. It succeeded in managing both volume and prices in a balanced manner. This is particularly remarkable in a market environment that remains volatile.
Source: Press Release Activity Indicators Q1/2025
AXA successfully continued its growth trajectory in the property and casualty insurance segment. Premium income rose in both the private customer and corporate customer segments, supported by a favorable pricing environment and the expansion of the customer base. It is particularly noteworthy that, following a comprehensive turnaround in the previous year, AXA is now once again making significant progress in acquiring new customers in the private insurance segment. The commercial insurance segments also performed solidly, supported by disciplined growth and positive price trends.
In the Life & Health segment, i.e. life and health insurance, the Group's strategic goal of further expanding this business was reflected. Life insurance benefited from strong sales of unit-linked products and low-capital savings solutions, particularly in key markets such as France, Italy, Japan, and Hong Kong. The occupational benefits business also continued to grow. In health insurance, however, AXA recorded solid growth across all regions, both in individual and group business. Overall, higher sales figures and improved customer loyalty led to a significant increase in net inflows.
The Asset Management segment also increased its revenues, mainly due to higher average assets under management, which led to an increase in management fees. Nevertheless, new business in this segment declined, mainly due to the expected loss of a large third-party mandate. Intra-group capital flows, for example from insurance companies, only partially offset this decline.
Despite the challenges in the financial markets, AXA's capital base remained robust. The Solvency II coverage ratio was 213 percent at the end of the first quarter. Although this represents a slight decline compared with the end of 2024, the Group emphasizes that this is primarily due to market changes and regulatory adjustments. The Group's operating profitability remained strong.
AXA stock forecast for 2025
In view of the preliminary figures for the first quarter of 2025, AXA believes it is well positioned to remain profitable and resilient for the rest of the year. However, no specific figures for the full year were given. The last annual report for 2024 did, however, reveal some details regarding the targets of the “Unlock the Future” strategy plan (2024 to 2026). The focus here is on annual growth in adjusted earnings per share of 6 to 8 percent, a return on equity of 14 to 16 percent, and cumulative cash upstream of over €21 billion by 2026. “Cash upstream” refers to distributions from subsidiaries to the parent company. Ultimately, these funds are likely to be generously distributed to shareholders. The allocation policy is to remain shareholder-friendly, with a target payout ratio of 75 percent, of which 60 percent will be paid as dividends and 15 percent in the form of share buybacks.
Source: Forecast net income and margin of AXA
Analysts are also optimistic. Profit forecasts for AXA indicate solid, albeit fluctuating, growth in the coming years. In 2025, profits are expected to rise sharply to 9.1 billion euros. Analysts expect a slight consolidation in the following years, with a minor decline to €8.9 billion forecast for 2026. Profits are then expected to pick up again and rise to €9.9 billion by 2028.
The net margin will fluctuate during this period. It will start at 8.8 percent in 2024, then fall to 7.83 percent in 2025 and stabilize in the following years at between 7.4 percent and 7.6 percent. Despite this slight erosion in margins, AXA remains on a profitable growth path with stable earnings potential.
Source: Estimates for earnings per share and P/E ratio of AXA shares
These developments are underpinned by forecasts for earnings per share (EPS) and the price-earnings ratio (P/E ratio). For 2024, analysts expect EPS of €3.49, which would represent an increase of around 12 percent compared with the previous year. In 2025, earnings per share are expected to rise to €4.18, representing growth of just under 20 percent. In the following years, the trend will remain stable with slight increases to €4.54 in 2028.
The P/E ratio, on the other hand, will decline, signaling a more attractive valuation. It currently stands at just under 12, but will fall to 10 with the expected 2025 figures and, based on current forecasts, will continue to decline to 9.2 by 2028. Ultimately, this could indicate undervalued potential on the market or a continuing conservative investor environment. More on this later in the valuation section.
Key figures for AXA shares from the dividend analysis
The dividend analysis of the AXA share is very positive overall, with 13 out of 15 points and a rating as a top scorer. The current dividend yield of 5.1 percent is particularly outstanding. It is clearly in the upper range of the market. Historically, there has even been more to gain from the AXA share: the average dividend yield over the last ten years is almost 6 percent.
Source: Dividend score for AXA shares
No excessive distributions were made. The payout ratio for the past three years stands at a solid 62 percent, which indicates a balanced relationship between distribution and reinvestment. It takes into account both the interests of shareholders and sustainable growth. The dividend growth of over 24 percent over the past five years also underscores the dividend profile of AXA shares. All of these points received the maximum score of three points.
Source: Dividend history of AXA shares since 2000
The only weak point is the lack of continuity in payments. Over the past ten years, the dividend has only been increased or kept constant five times in a row. This results in a point deduction in the 10-year continuity rating. To be fair, however, the dramatic nature of the situation at the time must be taken into account. 2019 and the years that followed were marked by the coronavirus crisis. It is therefore all the more encouraging that the upward trend in dividends continued in 2020. However, the chart also clearly shows that this is a cyclical company that is sensitive to financial crises. Looking ahead, analysts expect dividend growth to continue. In 2027, shareholders could then receive €2.65 per share, which would be almost a quarter more than the most recent dividend paid for 2024. Let's move on to the stock valuation.
Evaluation of AXA stock
The valuation of the AXA share appears attractive overall, even compared to many competitors in the insurance sector. Suffice it to mention the P/E ratio of 11.9, which seems extremely favorable given expected earnings growth of around 13 percent.
Source: Key figures for AXA shares
The ratio of enterprise value to free cash flow (EV/FCF) of 10 also reflects the company's strong cash flow generation combined with a favorable valuation. This picture is complemented by a high dividend yield of 5.1 percent. There is potential for further dividend increases in the long term. However, there is also criticism: Compared to its direct competitor Allianz, the valuation is currently higher, as the following chart from aktien.guide's chart tool shows.
Source: Development of P/E ratios for AXA and Allianz
Nevertheless, the valuation of both companies can be considered extremely favorable. There are reasons for this, as the cautious valuation also reflects the market's structural mistrust of the insurance industry. Insurance stocks are traditionally valued at a discount by many investors because they are considered capital-intensive, complex, and highly regulated. Added to this are macroeconomic risks such as geopolitical uncertainties, rising claims costs due to natural disasters, and possible economic slowdowns. These risks represent additional uncertainties, especially for large insurers such as AXA with a broad international presence. Intense competition in the European insurance market also contributes to the depressed valuation. Many providers compete for similar customer segments, which can create price pressure in the long term. In addition, new digital competitors, known as InsurTechs, are challenging established business models, especially in lower-margin standard products. In short, the favorable valuation of AXA shares reflects less a weakness of the company itself than the market's skepticism toward the entire sector.
Conclusion on AXA stock
AXA presents itself as a solid and broadly diversified insurance company with a stable business model, an attractive dividend yield, and convincing operational momentum. The implementation of the “Unlock the Future” strategy ensures organic growth and margin stability in a market environment that is favorable for insurers overall.
Despite these strengths, the stock continues to trade at a significant valuation discount, mainly due to industry-specific concerns and macroeconomic uncertainties.
In my opinion, this offers an interesting entry point for long-term investors, as AXA combines earnings power, high dividends and strategic clarity with a favorable valuation. Investors looking for stable cash flows, solid fundamentals and a defensive sector with positive interest rate dynamics will find a reliable dividend stock with potential here.
Source: Analyst opinions on AXA shares
The 15 analysts see it similarly, with 88 percent recommending a buy. The remaining 12 percent, or two analysts, rate the stock as a hold. The average price target is €44.88, almost seven percent above the current price. This means there is potential over a one-year horizon. Together with the traditionally high dividend, the total return could quickly reach double digits.
The author and/or persons or companies associated with aktien.guide own or may own shares in AXA.
This post represents an expression of opinion and not investment advice. Please note the legal information.
