Aviva share price: AJ Bell weighs in on CEO appointment

AJ Bell reckons Aviva’s (LON:AV) newly-appointed chief executive has his work cut out for him in ‘pacifying shareholders’ and getting the insurer back in shape, Citywire reports. The comments came after the FTSE 100 company unveiled yesterday that it had promoted Maurice Tulloch, chief executive officer for the group’s International Insurance business, to the top job.

Aviva’s share price rose in the previous session, adding 0.58 percent to 434.50p. The shares outperformed the broader UK market, with the benchmark FTSE 100 index gaining 27.66 points to end trading 0.39 percent higher at 7,134.39. The stock has been little changed this morning, having inched 0.18 percent higher to 435.30p as of 08:10 GMT, as compared with a 0.09-percent gain in the Footsie.

AJ Bell weighs in on Aviva

Citywire quoted AJ Bell’s Russ Mould as commenting yesterday that Aviva’s decision to promote an insider to the top job might “disappoint critics hoping for someone fresh to shake up the life insurer”. The analyst reckons that Maurice Tulloch  will be “immediately under pressure to reduce gearing levels and that could mean less generous dividend growth or lower share buybacks in the future,” as well as address earnings growth concerns.

“Aviva has significantly lagged its peers on the stock market, meaning Tulloch has his work cut out in terms of pacifying shareholders, getting the business in better shape, and carving out a path for the future,” Mould concluded.

Other analysts on insurer

Deutsche Bank reaffirmed Aviva as a ‘buy’ yesterday, with a price target of 490p on the shares, while Shore Capital placed the insurer ‘under review’. According to MarketBeat, the blue-chip group currently has a consensus ‘buy’ rating and an average price target of 529.85p.

Aviva is scheduled to update investors on its performance on Thursday.

As of 08:12 GMT, Tuesday, 05 March, Aviva plc share price is 435.30p.