Why this analyst is bullish on the NIB (ASX:NHF) share price

It's been a good year so far for the private health insurer — and it could get even better, according to one analyst

| More on:
elderly woman cheers in doctor's office

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The NIB Holdings Limited (ASX: NHF) share price has had a solid year thus far.

The outlook for shares in the private health insurer could be even rosier, according to some prominent analysts.

So, why does the NIB share price have such a healthy outlook?

Portfolio manager lauds the outlook for NIB

The NIB share price was highlighted in a recent interview hosted by Livewire Markets, titled 'how to uncover the next small-cap champions'.

The panel consisted of two noted Australian portfolio managers, with the theme rotating around healthcare and tech.

Both analysts noted the interesting thematic and intersection between healthcare and technology.

According to the panel, governments around the world are struggling with healthcare costs. As a result, technology has an important role to play in managing these challenges.

Mike Murray, who is head of domestic equities at Australian Ethical Investment Limited (ASX: AEF), highlighted NIB.

According to Murray, NIB is an "innovative company" that is diversifying from its bread and butter of health insurance. An example of this is their joint venture, Honeysuckle Health, which focuses on data science and develops programs that help people better invest in their health.

Murray noted that prevention ultimately helps the end customer and in turn also helps the health insurer in NIB.

More on the NIB share price

It has been an eventful year for the NIB share price thus far. Since the start of 2021, shares in the private health insurer have soared more than 12.5%.

At one point, the NIB share price was flying more than 35% higher for the year. However, the company gave back much of its gains for the year after releasing its full-year report.

For FY21, NIB reported strong policyholder sales growth and retention, with policyholder growth lifting 4.2% versus an industry average of 3.1%.

Other highlights from the company's full-year report included;

  • Total group revenue of $2.6 billion, up 2.9% on the prior corresponding period (FY20 $2.5 billion);
  • Group expense claim of $2 billion, up 2.5% (FY20 $1.95 billion);
  • Group underlying operating profit (UOP) of $204.9 million, up 39.5% (FY20 $146.9 million);
  • Net profit after tax (NPAT) of $160.5 million, up 84.5% (FY20 $87 million); and
  • Fully-franked final dividend of 14 cents per share, up from 4 cents per share.

Despite the strong report, investors remained cautious about the health insurer's outlook.

The NIB share price closed yesterday's trading session at $6.72.

Should you invest $1,000 in Adbri right now?

Before you buy Adbri shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Adbri wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor Nikhil Gangaram owns shares of Australian Ethical Investment Ltd. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Australian Ethical Investment Ltd. The Motley Fool Australia has recommended Australian Ethical Investment Ltd. and NIB Holdings Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

A man holds his head in his hands, despairing at the bad result he's reading on his computer.
Share Market News

These are the 10 most shorted ASX shares

Let's see which shares short sellers are targeting this week.

Read more »

A young woman wearing a red and white striped t-shirt puts her hand to her chin and looks sideways as she wonders whether to buy NAB shares
Opinions

The pros and cons of buying Wesfarmers shares in May

Is this retail giant an appealing opportunity?

Read more »

A man looking at his laptop and thinking.
Share Market News

5 things to watch on the ASX 200 on Monday

Here's what to expect on the local market today.

Read more »

Five retirees do a conga line dance on the beach celebrating the special dividend announced by Grange Resources today
Broker Notes

Why Macquarie thinks the NZ retirement village sector could be an emerging opportunity for ASX investors

Oceania Healthcare and Summerset could quietly emerge as high-upside plays for patient ASX investors.

Read more »

Excited couple celebrating success while looking at smartphone.
Broker Notes

5 high-conviction ASX 200 shares to buy

Brokers are tipping these shares as buys. Here’s what they rate highly.

Read more »

A woman in a business suit sits at her desk with gold bars in each hand while she kisses one bar with her eyes closed. Her desk has another three gold bars stacked in front of her. symbolising the rising Northern Star share price
Gold

How this ASX All Ords gold stock turned $10,000 into $78,740 in just one year

The ASX All Ords gold miner has raced higher over the year. Let’s find out how.

Read more »

Man raising both his arms in the air with a piggy bank on his lap, symbolising a record high.
Share Market News

US-China tariff deal sparks strong week for ASX 200

Energy shares ripped 5.77% higher while the ASX 200 lifted 1.37% over the five days.

Read more »

Broker written in white with a man drawing a yellow underline.
Broker Notes

Top brokers name 3 ASX shares to buy next week

Brokers gave buy ratings to these ASX shares last week. Why are they bullish?

Read more »