Allianz Nears 26-Year High as Insolvency Warning Casts a Shadow Over Record Earnings

Allianz shares trade near a 26-year peak with record profits and buybacks, but its credit arm warns of rising global insolvencies ahead of key May dates.

The Allianz share sits just 1.3 percent below its all-time high, a milestone that has eluded the stock for roughly 26 years. On 21 April, the shares touched a multi-decade peak of €394.80, and with two key dates in May approaching, investors are weighing whether the momentum can carry through. Yet even as the insurer posts record profits and returns cash to shareholders, a stark warning from its own credit insurance arm is injecting caution into the narrative.

Record Profits and a Steady Hand

The group’s 2025 performance provided the foundation for the rally. Business volumes rose 8.1 percent to €186.9 billion, while operating profit climbed 8.4 percent to €17.4 billion — a new record. Management has set a target for 2026 at roughly the same level, €17.4 billion plus or minus €1 billion, signalling a period of consolidation rather than acceleration.

That steady outlook has not deterred the board from rewarding shareholders. A share buyback programme of up to €2.5 billion, announced in late February, is underway, with repurchased shares being cancelled. Between 2025 and 2027, the company plans to return at least 15 percent of net profit to investors on top of the regular dividend. For those seeking the proposed payout of €17.10 per share, the shares must be held by 8 May.

A Divergent Picture from Allianz Trade

While the parent company is enjoying a golden run, its credit insurance subsidiary Allianz Trade is painting a far more somber picture. The division has revised its global insolvency forecast upward for 2026, now expecting a 6 percent increase in corporate bankruptcies worldwide, up from a 5 percent estimate in October 2025. Geopolitical tensions and persistent trade conflicts are the primary drivers.

For Germany, Allianz Trade projects approximately 24,650 insolvencies — roughly 800 more than last year and the highest level since 2012. The construction, retail, and manufacturing sectors are under particular strain, with high energy costs and disrupted supply chains squeezing companies that lack pricing power. Globally, the division warns that around 2.2 million jobs could be at risk, with Europe accounting for 1.3 million of those. In Germany alone, some 209,000 positions are deemed highly vulnerable.

The question for the Allianz group is whether rising demand for credit insurance products will offset the higher claims costs that typically accompany a wave of insolvencies. The first-quarter results, due on 13 May, should offer early clues.

AI Transformation as a New Efficiency Benchmark

Beyond the cyclical challenges, Allianz is pursuing a structural overhaul through artificial intelligence. More than 900 AI use cases are now running across the group. In 2026, the company will roll out AllianzGPT 2.0 as an internal platform for all employees, while its in-house GenAI Lab has already developed over 30,000 AI agents.

The ambition is for these intelligent agents to handle multi-step processes autonomously, from document capture to claims processing, reducing manual intervention and shortening turnaround times. Whether these investments translate into measurable improvements will be reflected in metrics such as the combined ratio — and the Q1 numbers will provide the first concrete test.

A Tougher Line on Executive Pay

Shareholders attending the annual general meeting on 7 May will also vote on a revised compensation system that tightens the leash on management. Under the new rules, long-term bonuses will be forfeited if the Allianz share underperforms the STOXX Europe 600 Insurance Index by more than 25 percentage points over four years — a stricter threshold than the previous 50-point gap.

Goldman Sachs has recently upgraded the stock from “Neutral” to “Buy”, setting a price target of €450. The shares currently trade at around €388, roughly 1.7 percent below the 52-week high. On a technical basis, the stock sits about 6 percent above its 200-day moving average, with the relative strength index at 43 — a neutral reading that leaves room for either direction.

Two Dates That Could Define the Next Leg

The coming weeks present a binary setup for Allianz investors. The annual meeting on 7 May will test sentiment on governance and pay, while the Q1 release on 13 May will reveal whether the record operating performance of 2025 is sustainable and whether the AI agenda is already leaving a mark on the numbers. For a stock that has taken 26 years to return to within striking distance of its all-time high, the margin for error is slim — but the catalysts are aligned.