(Bloomberg) -- Axa SA, France’s largest insurer, plans to increase profitability through 2020 by seeking 2.1 billion euros ($2.4 billion) of cost cuts and growing digital investments to tap rising demand for policies protecting savings and health. The firm may also seek acquisitions to boost growth.
Axa is targeting an adjusted return on equity, a key measure of profitability, of 12% to 14% between this year and 2020, the Paris-based company said in a statement on Tuesday. Underlying earnings per share are expected to rise 3% to 7% annually over the period, the insurer said.
“Axa’s earnings target is rather ambitious, given the strong decline in interest rates,” said Andreas Schaefer, an analyst at Bankhaus Lampe with a buy rating on the insurer. “However, the insurer has a good track record of reaching its cost saving goals.” The shares were up 0.4% at 10 a.m. in Paris trading.
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