Back to top

Image: Bigstock

Globe Life (GL) Soars 20.2%: Is Further Upside Left in the Stock?

Read MoreHide Full Article

Globe Life (GL - Free Report) shares ended the last trading session 20.2% higher at $59.09. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 57.6% loss over the past four weeks.

Shares bounced back after the dip owing to short selling by Fuzzy Panda. Higher life and health sales, improved invested assets, increased productivity and agent count, strong liquidity position and effective capital deployment should help it retain the momentum.

Globe Life has been witnessing a positive trend in revenues, driven by premium growth in its Life Insurance and Health Insurance segments and net investment income. GL’s expansion initiatives to capture heavily populated and less penetrated areas should drive growth in the future.

The company has maintained a strong liquidity position with sufficient cash-generation capabilities. Its operations consist primarily of writing basic protection life and supplemental health insurance policies, which generate strong and stable cash flows. A strong capital position aids in wealth distribution on form of dividends and share buyback.

This life and health insurance company is expected to post quarterly earnings of $2.80 per share in its upcoming report, which represents a year-over-year change of +10.7%. Revenues are expected to be $1.43 billion, up 5.6% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Globe Life, the consensus EPS estimate for the quarter has been revised marginally higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on GL going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Globe Life is part of the Zacks Financial - Miscellaneous Services industry. AlTi Global, Inc. (ALTI - Free Report) , another stock in the same industry, closed the last trading session 4.7% lower at $4.70. ALTI has returned -22.5% in the past month.

AlTi Global, Inc.'s consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.03. Compared to the company's year-ago EPS, this represents no change. AlTi Global, Inc. currently boasts a Zacks Rank of #3 (Hold).

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

Globe Life Inc. (GL) - free report >>

AlTi Global, Inc. (ALTI) - free report >>

Published in