Prudential share price pushes higher ahead of first-half earnings

Prudential has seen it recent rally stall, but it can the share price move higher if there is a more optimistic outlook for the rest of the year?

When is Prudential’s earnings date?

Prudential reports earnings on 11 August, covering the first half (H1) of its financial year.

Prudential earnings – what does the City expect?

Prudential is expected to report earnings of $2.6 billion, up 0.4% from a year ago.

The group’s recent update in May revealed the scale of the challenge it was facing. Its normally fast growing Asian business had suffered due to lockdowns across the region, and while it may well have seen something of a recovery, the rest of the year is likely to be difficult.

Attention on the sector has focused on the fate of dividends, and while there is no expectation of a cut, investors should not hope for too much in the way of an increase for the time being.

At 21 times earnings, Prudential remains just below the 22.7 median of the past five years, and comfortably above the December 2018 valuation of around 18 times earnings.

How to trade Prudential’s earnings

Volatility in Prudential has steadily declined since March, and barring an uptick in mid-June has mostly moved in one direction. A current 14-day average true range (ATR) of 40 points to an average daily move of around 3.2%, compared to 14% back in March.

The last update in May prompted a drop of 5.3% in the share price, while annual results back in March saw a drop of 4%.

Prudential share price – technical analysis

Having rebounded from the late-July low around £11.00, the price finds itself back at trendline resistance from the late-February highs. A rally through £12.50 provides a more bullish view, while a reversal back below £11.00, breaching this support zone, restores the advantage to the sellers.

Prudential looking for a bullish catalyst

While the price has done well to hold support, it still lacks a bullish catalyst to drive it higher. Investors will be hoping that half-year numbers can provide this so that Prudential can stage a break to the upside.


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