Five Potentially Undervalued Life Insurance Companies

Joel Anderson |

life insurance stocks, life insurance stocks to invest in, best life insurance stocksA lot of companies in the financial sector took a pretty serious beating over the last five years. The housing bubble acted like a tidal wave that sunk all ships in the financial sector, and life insurance companies, which are often heavily invested in the market, didn't escape it. However, some five years later, it may be time for investors to rethink companies in the financial sector that had previously been overlooked. With the economy appearing to be in recovery, there's a chance that a buying opportunity could exist for stocks that show bullish valuations despite a rocky recent history.

These five life insurance stocks all have prices that appear relatively low based on their book value, sales, growth projections, and earnings. This could easily be because all of these companies, save one, is down over 20 percent over the last five years with the fall starting during the financial crisis. While predicting broad economic trends is never a sure thing, the fact that these companies appear to be a bargain buy at their current price might make them an attractive investment going forward.

Each of these following stocks met the following criteria for this screen. A market cap over $300 million, P/E of under 12.50, a forward P/E under 7.75, a PEG under one, a P/S under 0.75, and a P/B under one. Taken cummulatively, these all point to a share price that might not be in line with the underlying value of these companies. (If you're wondering what all these things mean, here's a quick refresher.)

Metlife (MET)

Market Cap: $40.79 billion   P/E: 6.15   Forward P/E: 6.91   PEG: 0.64   P/S: 0.58   P/B: 0.68

It's endorsed by Snoopy, what else could really matter? Metlife is an industry giant and well known brand name, and after losing about 40 percent of its share price over the last five years it could be a good time to get in.

Prudential Financial (PRU)

Market Cap: $28.75 billion   P/E: 8.37   Forward P/E: 7.49   PEG: 0.71   P/S: 0.59   P/B: 0.78

Prudential is another leader of the industry, boasting an array of financial products and services to its clients. Down over 30 percent over the last five years, it could be available at a bargain price.

Reinsurance Group of America (RGA)

Market Cap: $4.23 billion   P/E: 12.35   Forward P/E: 7.57   PEG: 0.78   P/S: 0.61   P/B: 0.69

Reinsurance Group of America is a holding company that, through its subsidiaries, engages in the life and health insurance industries. This is, however, the only company that came out of the financial crisis relatively unscathed, gaining just over 8.5 percent during the period in question.

Protective Life Corp. (PL)

Market Cap: $2.27 billion   P/E: 7.08   Forward P/E: 7.51   PEG: 0.89   P/S: 0.70   P/B: 0.54

Protective Life is another holding company that sells financial products through its subsidiaries like Protective Life Insurance Company. Since the start of March in 2007, the company's lost almost 40 percent of the value of its stock.

Symetra Financial Corporation (SYA)

Market Cap: $1.18 billion   P/E: 6.50   Forward P/E: 6.95   PEG: 0.71   P/S: 0.61   P/B: 0.44

Symetra is another financial services company in the life insurance industry. The loss of 22 percent of its share value over the last five years is relatively modest compared to some of the other companies on this list, but it's hardly unsubstantial.

*All data from finviz.com

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
CARO Carolina Financial Corporation 22.03 0.00 0.00 25,547
MET MetLife Inc. 43.66 -0.47 -1.07 5,753,166
PRU Prudential Financial Inc. 79.97 -1.68 -2.06 3,027,526
RGA Reinsurance Group of America Incorporated 107.09 -1.88 -1.73 148,148
SYA Symetra Financial n/a n/a n/a 0

Comments

Emerging Growth

New Age Farm Inc.

New Age Farm Inc is engaged in the development of the agriculture based business in Langley, British Columbia.

Private Markets

GoCoin

Blockchain currencies (e.g. Bitcoin) provide a new disruptive way to transfer value between parties over the internet as opposed to going through banks. GoCoin provides online merchants with a suite…

WayBetter

The spark hit Jamie when he saw co-workers competing to lose weight. Instead of pizzas and subs, they were eating salads and jogging along the river. Some were sneakily leaving…