MetLife Muddling Through For Now
Stephen Simpson, CFA
Stephen Simpson, CFA
MetLife: The Blimp Could Become A Led Zeppelin
James Stefurak, CFA
James Stefurak, CFA
Thu, Dec. 1, 12:22 PM
- The 10-year Treasury yield is up another seven basis points to 2.46%, and bank investors continue to wrap their arms around the idea that real regulatory loosening is on the way. The XLF is higher by 1.7% vs. the S&P 500 being flat. KBE +2.15%, KRE +2%.
- Bank of America (BAC +3%), Citigroup (C +1.7%), JPMorgan (JPM +2.2%), MetLife (MET +2.2%), Voya Financial (VOYA +3.3%), Northern Trust (NTRS +3.5%).
- Oil is now ahead 4.6% to $51.72, helping the XLE to another 2.1% advance.
- Tech (QQQ -1.4%) continues to struggle. Its decline today puts it lower by 1.1% since the election vs. the S&P's 2.8% advance, a 10% gain for the XLE, and a 14.5% move for the XLF.
Wed, Nov. 30, 11:45 AM
- While the pick of ex-Goldmanite and Hollywood player Steven Mnuchin for Treasury Secretary can hardly be called "draining the swamp," Pantheon's Ian Shepherdson says it should make Wall Street happy.
- In his first public comments after being selected, Mnuchin promised to "kill" swaths of Dodd-Frank.
- Also making Wall Street (and other bankers/insurers/brokers) happy today is another big move higher in interest rates, with the 10-year Treasury yield up 10 basis points to 2.394%.
- The S&P 500 is just marginally higher, but the KBE is ahead 1.9%, and the KRE 2%. XLF +1.35%
- Bank of America (BAC +3.4%), Citigroup (C +1.9%), JPMorgan (JPM +1.5%), Wells Fargo (WFC +1.8%), Morgan Stanley (MS +2.1%), Goldman Sachs (GS +3.9%), U.S. Bancorp (USB +1%), PNC Financial (PNC +1.4%), KeyCorp (KEY +2.2%), Fifth Third (FITB +2.5%), Regions Financial (RF +2.9%), BB&T (BBT +2.4%), SunTrust (STI +2%)
- MetLife (MET +2%), AIG (AIG +0.8%), Lincoln National (LNC +1.7%), Prudential (PRU +1.1%), Hartford (HIG +1.3%)
- ETFs: XLF, FAS, FAZ, UYG, VFH, IYF, BTO, IYG, FNCL, SEF, FXO, RYF, FINU, RWW, XLFS, FINZ, JHMF, FAZZ, FNCF
Mon, Nov. 28, 8:12 AM
- Following its big move since the election (a coda to the larger rally since late June), MetLife (NYSE:MET) has essentially discounted improved rate spread, tax, and regulation factors, as well as the Brighthouse spin and buyback, says analyst Randy Binner, downgrading to Market Perform from Outperform.
- While the gain in Hartford Financial (NYSE:HIG) since the vote wasn't as dramatic, he's "moving to the sidelines" on that name as well as the stock nears his $47 price target.
- Maiden Holdings (NASDAQ:MHLD) is up 17% since the election, but has just "marginal spread benefit" from higher rates, and won't benefit a whole lot from possible tax and regulatory changes.
- Source: Bloomberg
Mon, Nov. 14, 11:33 AM
- The major averages are stuck in the red, but the XLF is up 2.2% and the KBE +3% as financial sector investors mull a world of higher interest rates and lowered regulation.
- REITs continue to fall, but thanks to this fall's sector reclassification, those names are no longer in the financial indexes.
- Regional banks: Regions Financial (RF +6.9%), New York Community (NYCB +2.9%), KeyCorp (KEY +3.1%), PNC Financial (PNC +2.4%), Fifth Third (FITB +4%), SunTrust (STI +3%), M&T (MTB +3.1%)
- Insurers: MetLife (MET +2.2%), Lincoln (LNC +3.2%), AIG (AIG +2.1%), Hartford (HIG +2.3%), Travelers (TRV +1.4%)
- Online brokerage: Schwab (SCHW +3.6%), Ameritrade (AMTD +2.5%)
- Asset management: Franklin Resources (BEN +3.2%), Och-Ziff (OZM +4.5%), Invesco (IVZ +2.2%), T. Rowe Price (TROW +2.8%), BlackRock (BLK +0.4%)
Thu, Nov. 10, 12:32 PM
- The regulatory regime will be "more constructive" under a President Trump, says management at the company's investor day.
- Webcast and presentation slides
- Of the post-election surge in interest rates, CIO Steve Goulart says he's a fan, and that the move is "favorable to us."
- Ahead of today's meeting, the company announced a $3B buyback plan.
- MET's 4.7% gain in this session puts the two-day advance at about 12% - the best two-day move for the stock since 2009.
- Other insurers: Prudential (PRU +3.1%), Manulife (MFC +7.2%), Sun Life (SLF +8.3%), Lincoln Financial (LNC +2%), Primerica (PRI +10.6%), Voya (VOYA +6.2%), AIG (AIG +3.2%)
Thu, Nov. 10, 7:13 AM
- "Excess capital belongs to our shareholders," says MetLife (NYSE:MET) CEO Steve Kandarian, the company no doubt buoyed by the chance the Feds under a new administration will drop their battle to designate the insurer as a SIFI. The separation of Brighthouse Financial will help free up capital.
- Shares +2% premarket
Wed, Nov. 9, 11:26 AM
- The 10-year Treasury yield is up a whopping 10 basis points to 1.96%, surely a boon to yield-starved insurers. But for the larger players like MetLife (MET +5.2%), Prudential (PRU +4.2%), and AIG (AIG +1.6%), they may be able to look forward to end of their SIFI designations, and the boosted regulation and capital requirements that go with it (MetLife, of course, has already won a court case challenging its SIFI designation).
- Trump is likely to nominate two or three new Fed governors, says Capital Alpha Partners' Ian Katz, who doesn't expect Janet Yellen to seek to stay on when her term as chairman expires in 2018. He doesn't expect this to happen right away, but look for a Trump Treasury to de-designate AIG and Prudential (and presumably drop the MetLife appeal).
- Others enjoying the higher rates: Lincoln National (LNC +6.6%), Voya Financial (VOYA +5.2%), Primerica (PRI +10.4%)
Thu, Nov. 3, 10:26 AM
- MetLife (MET +2.5%), Prudential (PRU +3.5%), Lincoln National (LNC +6.7%), and AIG (AIG -4.5%) all reported after the bell last night, and the first three cruised past estimates, but AIG, not so much. AIG, of course, is more exposed to the P&C side of the industry, and results there are still in need of improvement.
- Capital returns: AIG slowed repurchases during Q3, but boosted its buyback by $3B; Lincoln National lifted its dividend 16%, and bought back $200M of stock in Q3, with share float down 8% Y/Y; Prudential returned nearly $1B in dividends and buybacks.
Wed, Nov. 2, 4:44 PM
- Q3 operating earnings of $1.4B or $1.28 per share are both about doubles from a year ago. After some busy adjustments in both periods, Q3 operating earnings of $1.53 vs. $1.36 earned one year ago.
- Book value per share (excl. AOCI) of $53.40 up 4% Y/Y. Tangible BVPS of $44.40 up 5%. Operating ROE of 9.7% up from 5%.
- Conference call tomorrow at 8 ET.
- Previously: MetLife beats by $0.14, beats on revenue (Nov. 2)
- MET +1.5% after hours
Wed, Nov. 2, 4:24 PM
Tue, Nov. 1, 5:35 PM
- ACLS, ADSW, AEL, AIG, ALIM, ALL, ALNY, ALSK, AMRS, ARC, AREX, AVD, AWK, AWR, BBRG, BCOV, BEAT, BGC, BKCC, BKFS, BKH, BREW, BRKR, CABO, CAR, CBPO, CCRN, CDI, CF, CGI, CHEF, CLR, CODI, COHR, CPE, CSGS, CSLT, CWEI, CXW, DMRC, DPLO, DPM, DVA, ENSG, EPAY, EQC, EQIX, ERII, ESRT, EVTC, EXAR, EYES, FB, FIT, FMC, FMI, FNF, FOE, FRSH, FRT, FSLR, FTK, G, GDDY, GPOR, HABT, HASI, HBM, HIVE, HOLX, HOS, HR, HSTM, HUBS, IAC, IL, INN, INOV, IO, IOSP, IRG, ITRI, IXYS, JONE, JRVR, KEYW, KGC, KTOS, LGCY, LHCG, LNC, LOPE, LPI, LPLA, LQ, LSI, MANT, MASI, MCHX, MDU, MET, MGNX, MHLD, MRO, MTGE, MUSA, MWA, NBIX, NGHC, NLY, NPO, NSTG, NVDQ, OESX, OME, OSUR, OTTR, PAA, PACB, PAGP, PE, PEGA, PEI, PEIX, PGRE, PRA, PRAH, PRU, PTCT, QCOM, QGEN, QTWO, QUIK, REGI, REXR, RGLD, RICE, RIG, RLJ, RMP, ROG, RRD, RRGB, RRTS, RUBI, RXN, RYN, SBRA, SBY, SF, SRC, SWM, TCAP, TEP, TPC, TROX, TTEC, TTWO, TVIA, TWO, VNDA, VVC, WFM, WMC, WMGI, WPG, WPX, WSTL, WTI, WTS, WYNN, XEC, XOXO, XPO, ZNGA
Thu, Oct. 27, 10:51 AM
- Rates are up across the globe again today, with the 10-year U.S. Treasury yield looking like it's ready for another assault on 2% - up 7 basis points on the session to 1.865%.
- Alongside a sharp move lower in REITs, the utility sector (XLU -0.9%) is facing a rough go of it.
- In the green though is the banking sector - (KBE +0.2%), (KRE +0.4%) - which has been awaiting a real move higher in rates for years. A big move on the long end while short rates hold (for now) is an added boost as it widens the yield curve.
- Bank of America (BAC +0.4%), Citigroup (C +0.4%), JPMorgan (JPM +0.4%), Wells Fargo (WFC +0.5%), PNC Financial (PNC +0.5%), Fifth Third (FITB +0.9%), U.S. Bancorp (USB +1.2%), BB& T(BBT +0.7%)
- Other high-yield beneficiaries include: MetLife (MET +0.9%), Lincoln Financial (LNC +1.3%), Schwab (SCHW +0.4%), Voya Financial (VOYA +0.9%).
- ETFs: XLF, FAS, FAZ, XLU, UTG, IDU, VPU, UYG, VFH, GUT, BUI, IYF, BTO, FUTY, IYG, FNCL, SEF, RYU, FXO, UPW, RYF, FXU, FINU, RWW, SDP, XLFS, FINZ, FUGAX, JHMF, FAZZ, FNCF, JHMU, UTLF
Tue, Oct. 25, 5:09 PM
Mon, Oct. 24, 9:32 AM
- The rematch between the two parties over MetLife's (NYSE:MET) SIFI designation is set to take place before a three-judge panel in U.S. appeals court today.
- Earlier this year, a federal judge struck down the Financial Stability Oversight Council's designation of the insurer as systemically important (and with it tougher regulatory standards), calling the FSOC out for its "arbitrary and capricious" process.
- A decision from the appeals panel could come before year-end, and the loser might then elevate the case to the full court or to the Supreme Court.
Thu, Oct. 20, 12:14 PM
- Don't look for the MetLife blimp "Snoopy" at football games and golf tournaments starting in 2017.
- The Snoopy/Peanuts branding was launched 30 years ago to make us more "friendly and approachable during a time when insurance companies were seen as cold and distant," says MetLife (NYSE:MET), waving goodbye to the gang.
- The need for direct consumer reach won't be nearly as great beginning next year when the company spins off most of its retail U.S. life insurance businesses. The company will then mostly be offering its products to corporate customers.
- The new global brand platform has the tagline: "MetLife. Navigating life together," and the new logo with have "MetLife" in a different typeface and be in black, not blue.
Fri, Oct. 7, 7:44 AM
- Alongside the Top Pick designation for VOYA is a $39 price target, suggesting 30% upside.
- Started at Underperform is Aflac (NYSE:AFL), with analyst John Nadel noting recent outperformance, global low rates as pressuring investment income, and the growing spread between U.S. and Japanese rates as boosting hedging costs. The $75 price target compares to yesterday's close of $72.07.
- Principal Financial Group (NYSE:PFG) also rates an Underperform, with Nadel noting more intense competition, exposure to FX and emerging markets volatility, and lower rates as maybe muting EPS growth and flatten margins.
- MetLife (NYSE:MET), Prudential (NYSE:PRU), Lincoln National (NYSE:LNC), Reinsurance Group of America (NYSE:RGA), AIG, and Unum Group (NYSE:UNM),