Aviva share price crawls back ahead of earnings. Is it a buy?

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Aviva (LON: AV.) share price has crawled back in the past few weeks as investors wait for the upcoming half-year results. The stock rose to a high of 409p, which was the highest point since June 30th of this year. It remains substantially below the year-to-date high of 606p.

Aviva earnings ahead

Aviva is one of the biggest British finance companies with a market cap of over £11 billion. The company provides its services through five key divisions: UK & Ireland Life, UK & Ireland General Insurance, Canada General Insurance, Aviva Investors, and International Investments. 

In 2021, the company reported a gross adjusted operating profit of over £2.2 billion, which was lower than the previous year’s £3.16 billion. Its total profit dropped by 30% to £2.03 billion while its centre liquidity rose to £6.6 billion. 

At the same time, the company returned over £4.75 billion to shareholders through a combination of dividends and share buybacks. It expects that it will increase its dividend per share to 31.5p. 

Aviva share price has underperformed the market this year as investors worry about the rising claims in its key industries. It has lagged other companies like Legal & General and abrdn. The results comes at a time when many analysts, such as those from Credit Suisse and Deutsche Bank, have trimmed their forecasts. 

In addition to the headline and bottom line numbers, investors will watch other things in the report. First, the firm is continuing to slash its costs. It is now implementing a plan to cut costs by about £500 million by 2023. 

Also, the CEO will likely talk about the recent acquisitions. The firm confirmed that it had acquired Azur Underwriting, a specialist managing agent focusing on high-net-worth individuals. It also spent £385 million to acquire Succession Wealth.

Aviva share price forecast

The four-hour chart shows that the AV share price has been under intense pressure in the past few months. Recently, however, the stock has managed to have a modest recovery. Along the way, it has moved slightly above the 25-day and 50-day moving averages while the MACD has moved to the neutral point. 

Therefore, the stock will likely keep rising as bulls target the next key resistance point at 430p. This rebound will likely continue after the company publishes its half-year results on Wednesday. A drop below the support at 400p will invalidate the bullish view.

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