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Riding on a steady growth momentum, the shares of MetLife Inc. (MET - Analyst Report) reached its 52-week high at $43.93 on May 29. Particularly, this global insurer’s shares rose about 15.2% since the company reported its first-quarter 2013 results in the beginning of May with a positive earnings surprise of 13.9%.

The improved momentum of this Zacks Rank #2 (Buy) stock is driven by improved premiums coupled with strict expense control. MetLife delivered positive earnings surprise in all of the last 4 quarters with an average beat of 7.3%.

Yesterday’s closing price represents a strong one-year return of about 44.8% and a year-to-date return of about 36.1%. The S&P 500 index jumped 25.1% and 17.5%, respectively during the same period. Average volume of shares traded over the last three months stands at approximately 8506.6K.

On May 1, MetLife reported first-quarter 2013 operating earnings per share of $1.48, modestly beating both the Zacks Consensus Estimate of $1.30 and the year-ago quarter earnings of $1.37.

Results reflected 2% growth in total revenue coupled with only 0.7% increase in total expenses. However, higher derivative losses from the unfavorable impact of foreign exchange rates and low interest rate partially tempered results.

Overall, MetLife’s capital position remains one of the sturdiest in the industry, cushioned by a diversified portfolio mix and a leading brand, which is reflected by its strong book value and return on equity (ROE) growth along with healthy ratings.

Further, MetLife appears an undervalued stock. The shares are trading at a 33% discount to the peer group average on a forward price-to-earnings basis and 5.1% discount on a price-to-book basis.

Return on equity and return on assets are 9.2% and 0.7%, respectively, marginally below the peer group average. Even the estimated long-term earnings growth is pegged at 9.5%, lower than the peer group average of 11.7%.

Apart from MetLife, other stocks that warrant a look in the insurance sector include Assured Guaranty Ltd. (AGO - Snapshot Report), XL Group Plc (XL - Analyst Report) and Old Republic International Corp. (ORI - Snapshot Report). All these stocks carry a Zacks Rank #1 (Strong Buy).

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