MetLife Downgraded to Strong Sell - Analyst Blog
08 Janvier 2013 - 5:50PM
Zacks
Zacks Investment Research downgraded MetLife
Inc. (MET) to a Zacks #5 Rank (Strong Sell) on January
5.
Why the Downgrade?
Following its projection of a decline in operating earnings growth
in 2013 on an annual basis, MetLife witnessed sharp downward
estimate revisions. The projection was in the range of $5.5–$5.9
billion or $4.95–$5.35 per share based on average shares
outstanding of about 1.11 billion. This guidance does not assume
share buybacks, which is expected to be withheld in 2013.
For 2013, most of the estimates were revised downward over the last
30 days, lowering the Zacks Consensus Estimate by 4.7% to $5.23 per
share. The Zacks Consensus Estimate for 2012 decreased 1% to $5.21
per share over the last 30 days as 13 out of the 19 estimates moved
downward. Even the higher 2012 guidance could not constrain the
fall.
MetLife raised the earnings projection for full year 2012 in the
band of $5.5–$5.6 billion or $5.15–$5.25 per share from the prior
estimate of $5.14–$5.57 billion or $4.80–$5.20 per share, based on
average shares outstanding of about 1.074 billion.
On October 31, 2012, MetLife reported mixed third-quarter results
with top line missing the Zacks Consensus Estimate, while bottom
line surpassing the same.
The better-than-expected bottom line was driven by higher net
investment income, as well as lower-than-expected operating
expenses.
Top line collapsed on weak premiums’ growth and unfavorable foreign
exchange. Also, low interest rates inflated the derivative
losses.
Other Stocks to Consider
Not all multi-line insurance stocks are performing as poorly as
MetLife. The following stocks with a favorable Zacks Rank are also
performing well and are worth considering. Enstar Group
Ltd. (ESGR) and Radian Group Inc. (RDN)
are among the other stocks that carry a Zacks #1 Rank (Strong
Buy).
ENSTAR GROUP LT (ESGR): Free Stock Analysis Report
METLIFE INC (MET): Free Stock Analysis Report
RADIAN GRP INC (RDN): Free Stock Analysis Report
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