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Aflac (AFL) Up 36% in a Year: More Growth on the Horizon?
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Shares of Aflac Incorporated (AFL - Free Report) have gained 36.1% in the past year compared with the industry’s 27.5% growth. The Finance sector and the S&P 500 composite index rose 11.9% and 17.6%, respectively, in the same time frame. With a market capitalization of $45.8 billion, the average volume of shares traded in the last three months was 2.2 million.
A strong U.S. business, product launches and upgrades coupled with a commendable financial position continue to drive Aflac.
The leading supplemental health insurance provider of the United States, presently carrying a Zacks Rank #2 (Buy), boasts an impressive track record of beating estimates in each of the trailing four quarters, the average beat being 7.76%.
Image Source: Zacks Investment Research
Return on equity in the trailing 12 months is currently pegged at 16.1%, which is higher than the industry’s average of 15.9%. This substantiates the company’s efficiency in utilizing shareholders’ funds.
Can AFL Retain the Momentum?
The Zacks Consensus Estimate for Aflac’s 2023 earnings is pegged at $6.00 per share, indicating a 12.6% increase from the year-ago reported figure. The consensus mark for 2024 earnings is pegged at $6.18 per share, indicating a 3% increase from the 2023 estimate.
Revenues of Aflac are expected to benefit on the back of increased sales across its U.S business, which in turn, are driven by persistent investments in growth-related initiatives and productivity gains. Sales of the segment improved 5.8% year over year in the first half of 2023.
Higher sales of insurance products contribute to AFL’s premiums, which usually make up the most of an insurer’s top-line growth.
Aflac has frequently resorted to product launches and upgrades to meet the evolving needs of its consumers. This July, it introduced the Aflac Group Life Term to 120 in a bid to offer cost-effective worksite life insurance, backed by flexible living benefits.
Whenever required, AFL has not stepped back from integrating digital solutions within its offerings to keep pace with the ongoing trend of digitization. The pursuit of digital transformation efforts has boosted the operational efficiencies of the insurer.
Additionally, Aflac boasts a solid financial standing backed by growing cash reserves and adequate cash-generating abilities. Its cash and cash equivalents improved 19.7% from the 2022-end level as of Jun 30, 2023. The financial strength encourages it to undertake business investments as well as engage in prudent capital-deployment moves through share buybacks and dividend payments.
Aflac boasts an impressive Value Score of B. Value Score helps find stocks that are undervalued. Back-tested results have shown that stocks with a favorable Value Score in combination with a solid Zacks Rank are the best investment bets.
AXIS Capital’s earnings surpassed estimates in three of the trailing four quarters and missed the mark once, the average surprise being 9.75%. The Zacks Consensus Estimate for AXS’s 2023 earnings suggests an improvement of 44.8% while the consensus estimate for revenues suggests growth of 7.9% from the corresponding year-ago reported figures. The consensus mark for AXS’s 2023 earnings has moved 10.4% north in the past 60 days.
The Zacks Consensus Estimate for ProAssurance’s 2023 earnings indicates a decline of 24.4% from the prior-year reported figure. The consensus estimate for revenues suggests a 1.2% fall from the year-ago reported figure. The consensus mark for PRA’s 2023 earnings has moved 25.9% north in the past 60 days.
HCI Group’s earnings outpaced estimates in each of the last four quarters, the average surprise being 448.41%. The Zacks Consensus Estimate for HCI’s 2023 earnings is pegged at $3.25 per share. A loss of $5.48 per share was reported in the prior year. The consensus estimate for revenues suggests growth of 1.1% from the year-ago reported figure.
Shares of AXIS Capital, ProAssurance and HCI Group have gained 13.5%, 1.2% and 29.9%, respectively, in the past year.
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Aflac (AFL) Up 36% in a Year: More Growth on the Horizon?
Shares of Aflac Incorporated (AFL - Free Report) have gained 36.1% in the past year compared with the industry’s 27.5% growth. The Finance sector and the S&P 500 composite index rose 11.9% and 17.6%, respectively, in the same time frame. With a market capitalization of $45.8 billion, the average volume of shares traded in the last three months was 2.2 million.
A strong U.S. business, product launches and upgrades coupled with a commendable financial position continue to drive Aflac.
The leading supplemental health insurance provider of the United States, presently carrying a Zacks Rank #2 (Buy), boasts an impressive track record of beating estimates in each of the trailing four quarters, the average beat being 7.76%.
Image Source: Zacks Investment Research
Return on equity in the trailing 12 months is currently pegged at 16.1%, which is higher than the industry’s average of 15.9%. This substantiates the company’s efficiency in utilizing shareholders’ funds.
Can AFL Retain the Momentum?
The Zacks Consensus Estimate for Aflac’s 2023 earnings is pegged at $6.00 per share, indicating a 12.6% increase from the year-ago reported figure. The consensus mark for 2024 earnings is pegged at $6.18 per share, indicating a 3% increase from the 2023 estimate.
Revenues of Aflac are expected to benefit on the back of increased sales across its U.S business, which in turn, are driven by persistent investments in growth-related initiatives and productivity gains. Sales of the segment improved 5.8% year over year in the first half of 2023.
Higher sales of insurance products contribute to AFL’s premiums, which usually make up the most of an insurer’s top-line growth.
Aflac has frequently resorted to product launches and upgrades to meet the evolving needs of its consumers. This July, it introduced the Aflac Group Life Term to 120 in a bid to offer cost-effective worksite life insurance, backed by flexible living benefits.
Whenever required, AFL has not stepped back from integrating digital solutions within its offerings to keep pace with the ongoing trend of digitization. The pursuit of digital transformation efforts has boosted the operational efficiencies of the insurer.
Additionally, Aflac boasts a solid financial standing backed by growing cash reserves and adequate cash-generating abilities. Its cash and cash equivalents improved 19.7% from the 2022-end level as of Jun 30, 2023. The financial strength encourages it to undertake business investments as well as engage in prudent capital-deployment moves through share buybacks and dividend payments.
Aflac boasts an impressive Value Score of B. Value Score helps find stocks that are undervalued. Back-tested results have shown that stocks with a favorable Value Score in combination with a solid Zacks Rank are the best investment bets.
Other Stocks to Consider
Some other top-ranked stocks in the insurance space are AXIS Capital Holdings Limited (AXS - Free Report) , ProAssurance Corporation (PRA - Free Report) and HCI Group, Inc. (HCI - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AXIS Capital’s earnings surpassed estimates in three of the trailing four quarters and missed the mark once, the average surprise being 9.75%. The Zacks Consensus Estimate for AXS’s 2023 earnings suggests an improvement of 44.8% while the consensus estimate for revenues suggests growth of 7.9% from the corresponding year-ago reported figures. The consensus mark for AXS’s 2023 earnings has moved 10.4% north in the past 60 days.
The Zacks Consensus Estimate for ProAssurance’s 2023 earnings indicates a decline of 24.4% from the prior-year reported figure. The consensus estimate for revenues suggests a 1.2% fall from the year-ago reported figure. The consensus mark for PRA’s 2023 earnings has moved 25.9% north in the past 60 days.
HCI Group’s earnings outpaced estimates in each of the last four quarters, the average surprise being 448.41%. The Zacks Consensus Estimate for HCI’s 2023 earnings is pegged at $3.25 per share. A loss of $5.48 per share was reported in the prior year. The consensus estimate for revenues suggests growth of 1.1% from the year-ago reported figure.
Shares of AXIS Capital, ProAssurance and HCI Group have gained 13.5%, 1.2% and 29.9%, respectively, in the past year.