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Here's Why Investors Should Stay Invested in Aflac Stock for Now
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Key Takeaways
Aflac's Japan and U.S. businesses are benefiting from solid product demand and premium persistency.
Japan sales rose 7%, while U.S. sales increased 2.8% in the first half of 2026.
Disciplined expenses and improved benefit trends are supporting growth across Aflac's core markets.
Aflac Incorporated (AFL - Free Report) is well-poised to grow, driven by strong product demand and high premium persistency across its key markets, stronger underwriting discipline and effective cost management.
Aflac — with a market capitalization of $60.7 billion — offers supplemental health and life insurance products in Japan and the United States. Its shares climbed 9.8% in the year-to-date period compared with 12.4% growth of the industry.
Courtesy of solid prospects, this Zacks Rank #3 (Hold) stock is worth retaining at the moment.
AFL’s Growth Drivers
Aflac Japan remains an important growth engine, with product innovation helping the company reach new customer segments. The refreshed Tsumitasu savings-type life insurance and Anshin Palette medical insurance continued to generate strong year-over-year sales growth. Japan sales increased 7% year over year in the first half of 2026, while Tsumitasu accounted for about 20% of total sales and is helping attract younger customers and support cross-selling of cancer and medical coverage.
In the United States, Aflac is benefiting from continued demand for group voluntary benefits, dental and vision products. In the first half of 2026, sales increased 2.8% year over year, while net earned premiums grew 2.9%. The company is maintaining a focus on profitable growth, supported by strong premium persistency of 79.4% and continued momentum in its group business.
Aflac is also benefiting from disciplined expense management and favorable benefit trends across its core markets. In the second quarter, Aflac Japan’s expense ratio was 20.2%, near the low end of its 20%-23% outlook for 2026, while its benefit ratio stood at 64%, which improved 250 basis points year over year. In the U.S. segment, the expense ratio was 36.1%, which improved 20 basis points year over year. It expects the unit’s expense ratio to be within the range of 36%-39% in 2026. The benefit ratio came in at 49.5%, within the company’s 48%-52% target range for 2026.
AFL maintains a strong financial position and concluded second-quarter 2026 with $6.1 billion in cash and cash equivalents and maintains a strong times-interest-earned ratio of 24.91X versus the industry’s 21.73X. Shareholder rewards remain a priority for the company. In the first six months of 2026, Aflac repurchased 17.5 million shares worth $2 billion.
Where Do Estimates for AFL Stand?
The Zacks Consensus Estimate for AFL’s 2026 earnings is pegged at $7.04 per share. Furthermore, the consensus mark for revenues is pegged at $17 billion for 2026. AFL missed earnings estimates in three of the past four quarters and beat once, with an average surprise of 6.6%.
Aflac Incorporated Price, Consensus and EPS Surprise
There are some factors, however, that investors should keep a careful eye on.
Operating cash flow has remained under pressure, declining 17.8% in 2023, 15.1% in 2024 and 5.6% in 2025. While the metric rebounded in first-half 2026, rising 9.3% year over year, the company will need to sustain this momentum for a meaningful turnaround.
Aflac’s shares trade at a forward P/E of 16.3X, above both its five-year median of 13.13X and the industry average of 13.7X. The elevated multiple suggests limited upside in the near term as investors may hesitate to extend further premium valuations amid an uneven earnings recovery.
The Zacks Consensus Estimate for Hippo Holdings’ current-year earnings is pinned at $2.46 per share and has witnessed two upward revisions in the past 30 days against no movement in the opposite direction. HIPO beat earnings estimates in each of the trailing four quarters, with the average surprise being 521.8%. The consensus estimate for current-year revenues is pegged at $581.9 million, implying 24.2% year-over-year growth.
The Zacks Consensus Estimate for Slide Insurance Holdings’ current-year earnings is pinned at $3.91 per share and has witnessed two upward revisions in the past 30 days against one movement in the opposite direction. SLDE beat earnings estimates in each of the trailing four quarters, with the average surprise being 36.9%. The consensus estimate for current-year revenues is pegged at $1.5 billion, implying 33% year-over-year growth.
The Zacks Consensus Estimate for Hanover Insurance Group’s current-year earnings is pinned at $20.15 per share and has witnessed five upward revisions in the past 30 days against no movement in the opposite direction. THG beat earnings estimates in each of the trailing four quarters, with the average surprise being 27.3%. The consensus estimate for current-year revenues is pegged at $7 billion, implying 4.6% year-over-year growth.
View the Zacks #1 Rank List
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Here's Why Investors Should Stay Invested in Aflac Stock for Now
Key Takeaways
Aflac Incorporated (AFL - Free Report) is well-poised to grow, driven by strong product demand and high premium persistency across its key markets, stronger underwriting discipline and effective cost management.
Aflac — with a market capitalization of $60.7 billion — offers supplemental health and life insurance products in Japan and the United States. Its shares climbed 9.8% in the year-to-date period compared with 12.4% growth of the industry.
Courtesy of solid prospects, this Zacks Rank #3 (Hold) stock is worth retaining at the moment.
AFL’s Growth Drivers
Aflac Japan remains an important growth engine, with product innovation helping the company reach new customer segments. The refreshed Tsumitasu savings-type life insurance and Anshin Palette medical insurance continued to generate strong year-over-year sales growth. Japan sales increased 7% year over year in the first half of 2026, while Tsumitasu accounted for about 20% of total sales and is helping attract younger customers and support cross-selling of cancer and medical coverage.
In the United States, Aflac is benefiting from continued demand for group voluntary benefits, dental and vision products. In the first half of 2026, sales increased 2.8% year over year, while net earned premiums grew 2.9%. The company is maintaining a focus on profitable growth, supported by strong premium persistency of 79.4% and continued momentum in its group business.
Aflac is also benefiting from disciplined expense management and favorable benefit trends across its core markets. In the second quarter, Aflac Japan’s expense ratio was 20.2%, near the low end of its 20%-23% outlook for 2026, while its benefit ratio stood at 64%, which improved 250 basis points year over year. In the U.S. segment, the expense ratio was 36.1%, which improved 20 basis points year over year. It expects the unit’s expense ratio to be within the range of 36%-39% in 2026. The benefit ratio came in at 49.5%, within the company’s 48%-52% target range for 2026.
AFL maintains a strong financial position and concluded second-quarter 2026 with $6.1 billion in cash and cash equivalents and maintains a strong times-interest-earned ratio of 24.91X versus the industry’s 21.73X. Shareholder rewards remain a priority for the company. In the first six months of 2026, Aflac repurchased 17.5 million shares worth $2 billion.
Where Do Estimates for AFL Stand?
The Zacks Consensus Estimate for AFL’s 2026 earnings is pegged at $7.04 per share. Furthermore, the consensus mark for revenues is pegged at $17 billion for 2026. AFL missed earnings estimates in three of the past four quarters and beat once, with an average surprise of 6.6%.
Aflac Incorporated Price, Consensus and EPS Surprise
Aflac Incorporated price-consensus-eps-surprise-chart | Aflac Incorporated Quote
AFL’s Key Risks
There are some factors, however, that investors should keep a careful eye on.
Operating cash flow has remained under pressure, declining 17.8% in 2023, 15.1% in 2024 and 5.6% in 2025. While the metric rebounded in first-half 2026, rising 9.3% year over year, the company will need to sustain this momentum for a meaningful turnaround.
Aflac’s shares trade at a forward P/E of 16.3X, above both its five-year median of 13.13X and the industry average of 13.7X. The elevated multiple suggests limited upside in the near term as investors may hesitate to extend further premium valuations amid an uneven earnings recovery.
Better-Ranked Players
Some better-ranked stocks in the insurance space are Hippo Holdings Inc. (HIPO - Free Report) , Slide Insurance Holdings, Inc. (SLDE - Free Report) and The Hanover Insurance Group, Inc. (THG - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Hippo Holdings’ current-year earnings is pinned at $2.46 per share and has witnessed two upward revisions in the past 30 days against no movement in the opposite direction. HIPO beat earnings estimates in each of the trailing four quarters, with the average surprise being 521.8%. The consensus estimate for current-year revenues is pegged at $581.9 million, implying 24.2% year-over-year growth.
The Zacks Consensus Estimate for Slide Insurance Holdings’ current-year earnings is pinned at $3.91 per share and has witnessed two upward revisions in the past 30 days against one movement in the opposite direction. SLDE beat earnings estimates in each of the trailing four quarters, with the average surprise being 36.9%. The consensus estimate for current-year revenues is pegged at $1.5 billion, implying 33% year-over-year growth.
The Zacks Consensus Estimate for Hanover Insurance Group’s current-year earnings is pinned at $20.15 per share and has witnessed five upward revisions in the past 30 days against no movement in the opposite direction. THG beat earnings estimates in each of the trailing four quarters, with the average surprise being 27.3%. The consensus estimate for current-year revenues is pegged at $7 billion, implying 4.6% year-over-year growth.