The NIB Holdings Limited (ASX: NHF) share price is rebounding on Tuesday after a selloff yesterday.
At the time of writing, the private health insurer's shares are up 3.5% to $7.26.
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Why is the NIB share price charging higher?
Investors have been bidding the NIB share price higher today after a leading broker suggested that Monday's weakness was a buying opportunity.
According to a note out of Citi, its analysts have upgraded NIB's shares to a buy rating with a $7.85 price target.
Based on where its shares are currently trading, this implies potential upside of 8.1% for investors over the next 12 months.
Citi also now expects a fully franked 28 cents per share dividend in FY 2023, which equates to a 3.9% yield, boosting the total potential return to approximately 12%.
While Citi acknowledges that NIB's first-half result was below expectations, it remains positive due to its above-system growth in the core ARHI segment.
What else are brokers saying?
Elsewhere, the team at Ord Minnett has also upgraded NIB's shares. Albeit to a hold rating with a $7.00 price target.
Finally, over at Morgans, its analysts have retained their hold rating with a reduced price target of $7.55. It saw positives and negatives from the result. The broker commented:
We would summarise this result as a headline miss, with the lower than expected ARHI net margin (8.6% versus 10.6% in the pcp) raising some concerns about the potential speed of future profit normalisation in this business. But, we think those concerns shouldn't completely overshadow what was a sound 1H23 underlying business performance, highlighted by 9%-13% revenue and NPAT growth on the pcp respectively.
