The Suncorp Group Ltd (ASX: SUN) share price is having a good finish to the week.
The shares of the insurance giant and regional bank are up close to 1.5% in early afternoon trade, bringing their one-month return to 6.5%.
Can its shares climb higher?
As far as one of Australia's leading brokers is concerned, Suncorp's shares can still climb significantly higher from here.
According to a note out of UBS, the broker has retained its buy rating and $14.80 price target following the release of its first-quarter update yesterday.
Analysts at UBS appear to have been impressed with the 2.4% increase in gross loans from its banking business during the quarter.
This lending growth was primarily due to strong home lending supported by improved capability, simplified processes, and improved retention.
Furthermore, this was achieved while maintaining its commitment to responsible and sustainable lending practices.
According to management, Suncorp is well placed within macro-prudential measures with year-on-year investor lending growth of 7.6% and new interest-only lending of 29% achieved for the quarter.
Should you invest?
Based on UBS' price target and its current share price, Suncorp's shares could have potential upside of almost 7% over the next 12 months.
This extends to over 12% if you include the trailing fully franked 5.2% dividend its shares provide currently.
I believe this represents a compelling risk/reward that makes Suncorp one of the best options in the sector right now ahead of rivals QBE Insurance Group Ltd (ASX: QBE) and Insurance Australia Group Ltd (ASX: IAG).
