This report is an updated version of the report published on 31 January 2024 at 1:00 PM AEDT.

NIB Holdings Limited (ASX: NHF) 

NIB Holdings Limited (ASX: NHF) is an ASX listed health-related insurance provider in Australia and New Zealand. The company offers a range of health insurance products and services tailored to individuals, families, and corporate clients.

Recommendation Rationale - SELL at AUD 5.820

• Facing Resistance: With the 14-day RSI around 66.22, NHF is approaching overbought territory, suggesting potential for a price pullback.
• Expected Operating Loss in New Zealand: NIB anticipates an operating loss of around AU$10 million in H1 FY25 due to extraordinary growth in claims, negatively impacting overall group performance.
• Reliance on Pricing and Cost Savings: The reliance on higher pricing and cost-cutting measures to offset claims inflation in H2 FY25 could face execution risks, especially if inflation persists longer than expected.
• High Claims Inflation: Post-pandemic claims inflation in New Zealand is significantly affecting margins, with profitability expected to be weaker than FY24 despite recovery efforts.

Daily Price Chart

Daily Technical Chart, Data Source: REFINITIV

Considering the rally in share price movement, current trading level, and risks associated, the share price can witness resistance at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current market price of AUD 5.820, as of 31 January 2025, at 11:45 AM AEDT.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 31 January 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.  

Note 4: Dividend Yield may vary as per the stock price movement. 

Note 5: Kalkine reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.