01:25 PM EDT, 07/29/2025 (MT Newswires) -- National Bank is maintaining its favourable outlook for the property & casualty insurance sector as fundamentals remain solid into H2 2025. "While we have seen multiples re-rate to the high end of their historic range, we see upside from continued underwriting strength and book value growth," writes analyst Jaeme Gloyn.

There has been some softening in select areas of the market, but overall conditions remain broadly attractive and are expected to stay firm through 2025, Gloyn adds. This will be supported by moderating claims inflation and disciplined risk selection.

Entering the second half of the year, and given the macro uncertainty to start the year, National Bank has split its top picks into two categories: i) quality names where Gloyn sees valuation upside despite the uncertainty (Element Fleet and Fairfax Financial ( FRFHF )), and ii) bargain picks where the macro was weighing too heavily (ECN Capital ( ECNCF ), goeasy, and Brookfield Business Partners) which would require a shift to a more risk-on environment to outperform.

"Our quality picks have continued to perform well year-to-date, while our bargain picks are beginning to catch up as markets lean more risk-on."

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