Admiral shares hold a hit as dividend cleave

After Direct Line’s shocking profit warning and dividend cancellation earlier this year, it’s impartial to say that expectations were low ahead of Admiral’s latest results.

However, they still construct for horrible reading, which is why the share price has slumped on the news.

AJ Bell’s Russ Mould said: “The full year ordinary dividend has been cleave by 40%, although investors are still getting a special dividend on top. In light of what happened with Direct Line, Admiral’s shareholders should thank their lucky stars they’re getting any cash at all.

“section of the reason why Admiral is still able to return money to shareholders is that it is better capitalised and argues that it was quicker than most to react to changing market conditions. Inflation pushed up the cost of fixing cars and homes under insurance policies, and unfavourable weather conditions gain caused an increase in claims.

“Admiral pushed up its prices as soon as its could, which pain its growth as it became less competitive but helped to protect profits to some degree.”