QBE Insurance Group Ltd (QBE.AU) saw its shares plummet 5.01% in intraday trading, following Macquarie's decision to trim the price target for the Australian insurer. The stock's sharp decline comes amid growing concerns over potential higher-than-budgeted catastrophe costs for the first quarter of 2025.

Macquarie, a leading financial services group, reduced its price target for QBE to A$23 from A$23.2, while maintaining an "outperform" recommendation. The adjustment was accompanied by a 4.9% cut in the FY25 earnings estimate for the insurance giant. Despite the reduction, Macquarie's stance remains relatively optimistic, as the average rating from 13 analysts covering QBE is "buy" with a median price target of A$24.05.

The primary driver behind the downward revision appears to be the anticipated impact of recent catastrophic events on QBE's financial performance. Macquarie noted that first-quarter 2025 catastrophes, including California wildfires, Cyclone Alfred, and Queensland flooding, could exceed the company's budget allocations. These events have raised concerns among investors about potential pressure on QBE's profitability, contributing to the significant sell-off in the stock.