JPM Europe Equity Research Today’s Morning Meeting

Europe First to Market 28 July 2026

Today’s Morning Meeting | Also Published Today | Key Changes | JPM Events | Upcoming Earnings

Today’s Morning Meeting CW | | European Reinsurance (Kamran M Hossain)

Deja Vu heading into Q2 results - Moving Swiss Re to UW and placing Hannover Re on Negative Catalyst Watch

Moving Swiss Re from N to UW and placing Hannover Re on Negative Catalyst Watch. We downgrade Swiss Re to UW (from N), with the stock trading at a small premium on P/E and in line on dividend yield compared to Munich Re despite a shorter track record of delivery. We expect Swiss Re’s earnings to flatline over the next couple of years as the impacts of the softer market become apparent for the business. We reduce our Dec-27 PT to CHF125 from CHF140. Ahead of its Q2 results on 12th August, we also place Hannover Re (N) on Negative Catalyst Watch on the basis that we expect the weak revenue trends seen at Q1 to continue, with these not being factored into consensus. Our most preferred name in reinsurance is Munich Re (OW) which we see having many options to achieve its 2030 8%+ EPS CAGR target.

CW | Kingfisher (Georgina Johanan, ACA) (KGF LN, UW)

Q2/ H1 27 preview: near-term risk lies to the downside – place on Negative CW

Kingfisher is scheduled to report H1 27 results (to end Jul), including a Q2 trading update, on 22 Sep (followed by a B&Q store visit on 25 Sep). UK data and peer commentary for the period suggest that the heatwave could have been at least slightly unhelpful for B&Q, and we forecast a LFL of -1% for the quarter (below cons. for +1.3%). Similarly, given the very strong seasonal performance in H1 26, we expect H1 27 UK retail profit to move backwards by 6% yoy, to £323m (leaving us 5% below cons.). In France and Poland, we are more closely in line with cons. We are, however, mindful that the consumer remains soft in the fomer, and with material cost saving opportunities already achieved, room for incremental efficiencies to support bottom line, in a scenario of ongoing LFL declines, is now more limited. For the group overall, we model H1 27 PBT - 2% yoy to £359m, sitting c.3% below cons. We leave our FY PBT forecasts materially unchanged. For FY 27 we look for +1% yoy to £567m – the bottom of the guidance range and c.2% below cons. (guidance range £565-625m). More broadly, there is some near-term uncertainty for the UK housing market outlook. While, in the long term, stamp duty removal could be very helpful for housing transaction levels, we think the potential for a change in policy could be causing a material short-term slowdown. We appreciate that new UK Prime Minister, Andy Burnham, yesterday stated that he would not be removing or changing stamp duty in the next budget. However, in our view, the messaging is confusing, and the material nature of the tax could well create caution from potential buyers. Combined with, as yet, no update on a replacement for outgoing CEO Thierry Garnier, and the recent recovery in the stock, we see the risk as being to the downside, and place the stock on Negative Catalyst Watch ahead of the results.

AFL | | Paper & Packaging (Detlef Winckelmann)

EMEA Equity Research AC Europe Equity Research ( July 2026 JPMORGAN

Pricing cycle starting to pick up pace, increasing earnings expectations for corrugators; Upgrade International Paper on better risk/reward set-up

Last Friday, Green Markets reported that PKG had announced a price increase of $140/t for US kraftliner, to be implemented on 1 September 2026 (read first take here). While we think that a full implementation is unlikely, we take this opportunity to address a couple of key debates. In this note, we discuss: (1) the current and implied price/cost potential of the US linerboard market, (2) where we think prices should settle after considering the incentive price needed to add new capacity, (3) what this price increase means for valuations, and (4) how this impacts peer companies differently. We conclude that this latest round of price increases is not cost driven but rather driven by favorable supply/demand dynamics and prices still being below levels needed to incentivise new capacity. Furthermore, we see PKG and IP as the most…