Torchmark (NYSE:TMK) and Metlife (NYSE:MET) are both large-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, institutional ownership, dividends, risk, valuation and profitability.
Earnings and Valuation
This table compares Torchmark and Metlife’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Torchmark||$4.16 billion||2.39||$1.45 billion||$4.82||18.28|
|Metlife||$62.09 billion||0.77||$4.01 billion||$4.50||10.74|
This is a summary of current recommendations for Torchmark and Metlife, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Torchmark currently has a consensus target price of $83.57, suggesting a potential downside of 5.13%. Metlife has a consensus target price of $55.00, suggesting a potential upside of 13.82%. Given Metlife’s stronger consensus rating and higher possible upside, analysts clearly believe Metlife is more favorable than Torchmark.
Volatility and Risk
Torchmark has a beta of 0.91, suggesting that its stock price is 9% less volatile than the S&P 500. Comparatively, Metlife has a beta of 1.23, suggesting that its stock price is 23% more volatile than the S&P 500.
Institutional and Insider Ownership
73.7% of Torchmark shares are owned by institutional investors. Comparatively, 77.4% of Metlife shares are owned by institutional investors. 3.7% of Torchmark shares are owned by company insiders. Comparatively, 0.3% of Metlife shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
This table compares Torchmark and Metlife’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Torchmark pays an annual dividend of $0.64 per share and has a dividend yield of 0.7%. Metlife pays an annual dividend of $1.68 per share and has a dividend yield of 3.5%. Torchmark pays out 13.3% of its earnings in the form of a dividend. Metlife pays out 37.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Torchmark has raised its dividend for 8 consecutive years and Metlife has raised its dividend for 5 consecutive years.
Torchmark beats Metlife on 9 of the 17 factors compared between the two stocks.
Torchmark Corporation, through its subsidiaries, provides various life and health insurance products, and annuities in the United States, Canada, and New Zealand. It operates through four segments: Life Insurance, Supplemental Health Insurance, Annuities, and Investments. The Life Insurance segment offers traditional and interest-sensitive whole life and term life insurance, and other life insurance. The Supplemental Health Insurance segment provides health insurance products comprising Medicare Supplements, critical illness, accident, and limited-benefit supplemental hospital and surgical coverages. The Annuities segment provides single-premium and flexible-premium deferred annuities. The company sells its products through sales by direct response, exclusive agents, and independent agents, as well as through direct mail, electronic media, and insert media. Torchmark Corporation was founded in 1900 and is headquartered in McKinney, Texas.
MetLife, Inc. engages in the insurance, annuities, employee benefits, and asset management businesses. It operates through five segments: U.S.; Asia; Latin America; Europe, the Middle East and Africa; and MetLife Holdings. The company offers life, dental, group short- and long-term disability, individual disability, accidental death and dismemberment, vision, and accident and health coverages, as well as prepaid legal plans; administrative services-only arrangements to employers; and stable value products, including general and separate account guaranteed interest contracts, and private floating rate funding agreements. It also provides pension risk transfers, institutional income annuities, tort settlements, and capital markets investment products; and other products and services, such as life insurance products and funding agreements for funding postretirement benefits, as well as company, bank, or trust-owned life insurance used to finance nonqualified benefit programs for executives. In addition, the company offers automobile, homeowners', and personal excess liability, as well as small business owners' property, liability, and business interruption insurance products. Further, it provides fixed annuities and pension products; medical and credit insurance products; variable, universal, term, endowment, and whole life insurance products; variable, and fixed and indexed-linked annuities; and protection against costs of long-term health care services. MetLife, Inc. has a strategic alliance with Ernst & Young LLP. The company serves individuals, corporations and their employees, and other institutions through independent agents, property and casualty specialists, sales forces, sales teams and relationship managers, and other organizations, as well as through career agency, bancassurance, direct marketing, brokerage, and other third-party distribution and e-commerce channels. MetLife, Inc. was founded in 1863 and is headquartered in New York, New York.
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