The Insurance Australia Group Ltd (ASX: IAG) share price has been pushing higher this month.
This is despite CMC Hospitality filing an application starting a representative proceeding against IAG in the Federal Court.
It appears investors are willing to put the company's FY21 woes aside and are focusing on the FY22 financial outlook.
At Friday's market close, the IAG share price finished the day up 1.33% to $5.33. This added to its gain of 2.5% in September so far.
During the week, IAG peaked at $5.49 — not far off its 52-week high of $5.51 reached on 13 August.
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What's driving IAG higher lately?
A likely catalyst is that investors are bullish on the company's anticipated performance for FY22.
In its full-year results, IAG highlighted that it achieved a mostly solid scorecard, with growth across key metrics.
The biggest downside of the report was the company's bottom line, registering a net loss after tax of $427 million.
However, it was the result of significant one-off corporate expenses, mainly relating to business interruption, customer refunds, and payroll remediation.
Looking ahead, IAG reintroduced its guidance, given its sound underlying financial numbers in FY21.
Gross written premium (GWP) is expected to produce "low single-digit growth" and an insurance margin of between 13.5% and 15.5% for FY22.
The company said the guidance aligns with its aspirational goal to achieve a 15% to 17% insurance margin over the medium term. IAG believes an insurance profit of at least $250 million is achievable over the next 3 to 5 years.
IAG managing director and CEO, Nick Hawkins commented:
The strength of our core business and its sound underlying performance in FY21, our new operating model with clear, embedded executive responsibilities, as well as greater certainty in the economic outlook, mean that we are confident that IAG's underlying performance will continue to improve.
IAG share price summary
Over the past 12 months, IAG shares have moved about 10% higher, with year-to-date gains of close to 15%.
The IAG share price has underperformed the S&P/ASX 200 Index (ASX: XJO), which is 26% higher over the 12 months and almost 11% higher year to date.
Based on today's price, IAG has a market capitalisation of roughly $13.11 billion, with 2.46 billion shares on its registry.
