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TheStreet.com
March 10, 2010 Wednesday 16:14 PM EST
SECTION: NEWS & ANALYSIS; TheStreet.com Ratings
LENGTH: 468 words
HEADLINE: MetLife, Aflac, Prudential Hit Highs
BYLINE: Jake Lynch, TheStreet.com Ratings Investment Analyst
BOSTON (TheStreet) — U.S. stocks gained Wednesday as wholesale inventories declined marginally. Here are three insurance stocks that hit 52-week highs. 3. Aflac(AFL:NYSE) rose 2.4% to $52.46, hitting a high of $52.50. Shares of the life and health insurer have gained 11% in the past month. Quarter: Fourth-quarter profit increased 28% to $252 million, or 53 cents a share, as revenue climbed 7.9% to $4.6 billion. Aflac’s operating margin inched up from 7.2% to 8%. Its balance sheet contains $3.1 billion of cash and $2.6 billion of debt. Stock: Aflac has quadrupled in the past year, outperforming U.S. indices. The stock trades at a price-to-projected-earnings ratio of 8.8, a 29% discount to its peer-group average. It’s expensive based on trailing earnings, book value and sales. Consensus: Eight analysts covering Aflac recommend purchasing its shares and 11 advise holding them. Morgan Stanley(MS:NYSE) expects Aflac to rise 24% to $65. TheStreet’s stock model, which evaluates fundamentals and performance, rates Aflac “hold.” 2. Prudential Financial(PRU:NYSE) increased 0.7% to $55.81, touching a high of $56.60. Shares of the life and health insurer have advanced 14% during the past month. Quarter: Prudential swung to a fourth-quarter profit of $1.9 billion, or $3.78, from a loss of $1.6 billion, or $3.92, a year earlier. Revenue increased 25% to $8.7 billion. The operating margin climbed from negative territory to 13%. Prudential holds $46 billion of cash and $30 billion of debt. Stock: Prudential Financial has quadrupled in the past year, beating major benchmarks. The stock sells for a price-to-projected-earnings ratio of 8.5, a 31% discount to the industry average. It’s also cheap based on book value, sales and cash flow. Consensus: Of the 20 firms following Prudential, 13 advocate purchasing its shares and the rest say to hold them. Atlantic Equities projects the stock will hit $77, implying 38% upside. Our stock model rates Prudential “hold.”1. MetLife(MET:NYSE) gained 2.4% to $41.78, hitting a high of $42.20. Shares of the life and health insurer have risen 20% in the past month. Quarter: Fourth-quarter profit tumbled 68% to $320 million, or 35 cents, as revenue fell 12% to $12 billion. MetLife’s operating margin narrowed from 13% to 4.1%. Its balance sheet contains $28 billion of cash and $33 billion of debt. Stock: MetLife has nearly tripled in the past year, outpacing U.S. indices. The stock trades at a price-to-projected-earnings ratio of 8.1, a 34% discount to its peer-group average. It’s also cheap based on book value, sales and cash flow. Consensus: Of analysts covering MetLife, 12 recommend purchasing shares, four advise holding and two advocate selling them. Our model rates MetLife “sell” because of recent losses and high debt.— Reported by Jake Lynch in Boston.
LOAD-DATE: March 11, 2010
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