QBE has rallied ~60% from its 2022 low on the combination of rising yields and solid improvement/simplification of the business. We like this insurance stock that has more facets at play than just bond yields but the stock continues to feel stretched near $16 and a decent rally by bonds will likely be a headwind on the business and share price.
- We like the direction QBE is heading as a business but not the risk/reward until the ~$14 area – QBE reports their 1H numbers on Thursday.
- Hence rising bonds/falling yields will keep us on the sidelines with regard to insurance but it may provide opportunities moving forward.
MM likes QBE around $14
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