TOWER LIMITED (TWR)
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25/05/2026

1

Buy

$1.75

13.64%

A remediation provision for another pricing error and softer top-line momentum tempered an otherwise solid 1H26 result for Tower, Citi notes.

Management downgraded FY26 gross written premium (GWP) growth guidance to low-single digits from 5%-10%, also raising concerns on the delivery of its medium-term target.

While regulatory risks remain, the broker highlights supportive home unit growth of 9% in 1H and expects stronger GWP growth when the insurance cycle turns.

Tailwinds from the Westpac partnership commencing July 1 are also expected to support premium growth.

Citi retains a Buy rating and $1.75 target, down from $1.85. EPS forecasts for FY27 and FY28 were lowered by -5%.

25/05/2026

2

Overweight

-

-

Jarden retains an Overweight rating for Tower with its target price decreased to NZ$2.32 from NZ$2.42 following the first-half financial results.

A solid first-half normalised net profit of NZ$36.8m was reported, outperforming broker estimates as lower reinsurance and claims costs offset a miss on gross written premium.

The claims expense ratio landed at 51.1%, suggesting the insurer is well positioned to remain within the full-year large events guidance despite recent weather events in April, the broker suggests.

Management maintained FY26 earnings guidance of NZ$87m to NZ$97m while reducing gross written premium growth expectations to low-single digits reflecting a softer macroeconomic backdrop.

Forecast earnings per share are revised down by -5% to -6% across the medium term to account for the softer premium rating environment, partially offset by an uplift in dividend projections.

FORECAST
Jarden forecasts a full year FY26 dividend of 10.46 cents and EPS of 17.43 cents.
Jarden forecasts a full year FY27 dividend of 11.59 cents and EPS of 19.61 cents.