Back to top

Analyst Blog

Credit rating agency A.M. Best Co. has provided MetLife, Inc.’s (MET - Analyst Report) 4.785% senior secured notes worth $1 billion with an “a–” debt rating. Proceeds from the 30-year fixed rate senior note issuance will be used for general corporate purposes. It includes the repayment of the $1.35 billion outstanding notes that are scheduled to mature in 2014.

The rating takes into consideration MetLife’s competitive market strength, strong brand value and diverse business mix. Moreover, strong operating leverage and a wide scale of operations were also taken into account. Further, A.M. Best Co.’s rating recognizes MetLife’s financial leverage that is projected to remain within 30% and interest coverage that is anticipated to remain higher than five times going forward.

MetLife’s $1 billion notes have been assigned ratings by other credit ratings agencies as well. On Nov 7, 2013, Moody’s Investors Service, the credit rating wing of Moody’s Corporation (MCO - Analyst Report) provided the 30-year fixed rate $1 billion senior unsecured notes of MetLife with an “A3” rating. Strong brand value, scale of distribution, operating leverage, financial strength and an attractive product portfolio acted in favor of the company. The rating carried a negative outlook.

The very next day, another credit rating agency, Fitch Ratings assigned the senior debt of MetLife with an “A–” rating. The rating carried a stable outlook. The strong financial performance and balance sheet of MetLife led to the A– rating.

Strong ratings from credit rating agencies increase creditworthiness of a company in the market. We believe that MetLife’s present score with the three credit rating agencies will help it write more business going forward.

MetLife currently carries a Zacks Rank #3 (Hold).  Among other multiline insurers worth considering, Kemper Corporation (KMPR - Snapshot Report) carries a favorable Zacks Rank #1 (Strong Buy) while AXA Group (AXAHY) carries a Zacks Rank #2 (Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
RPC INC RES 24.91 +8.35%
LITHIA MOTO… LAD 94.59 +4.60%
DELTA AIR L… DAL 39.15 +3.90%
FLAMEL TECH… FLML 14.51 +3.50%
SOUTHWEST A… LUV 28.87 +2.92%