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Primerica Stock Up 22% YTD: Will the Momentum Continue?

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Primerica’s (PRI - Free Report) shares have surged 22% year to date, outperforming the industry's growth of 11.5% and the Zacks S&P 500 composite’s rise of 14.2%. Solid performance at Investment and Savings Products segment, sales force growth and productivity, strong capital position and prudent capital deployment should continue to drive the stock.

With a market capitalization of $5 billion, average volume of shares traded in the last three months was 0.2 million.



Is the Rally Likely to Continue?

This Zacks Rank #3 (Hold) provider of financial products to middle-income households in the United States and Canada has a solid track record of delivering positive earnings surprise in the last five quarters, with the average beat being 4.35%.

Primerica has an impressive VGM Score of B. This style score helps to identify stocks with the most attractive value, growth and momentum.

Primerica should continue to benefit from expanding protection product offerings, increasing client investment options and developing digital capabilities.

The company expects Term Life issued policies to be up by 2% in the second half of 2019 but given a weak first half, full-year issued policies are estimated to be down about 3%. Adjusted direct premium is estimated to grow about 10.5% in 2019. The company expects second-half sales momentum to continue next year resulting in an adjusted direct premium growth rate at or above 9% in 2020. Operating margin for 2019 is projected in the range of 18.5% and 19%.

This leading term life insurance issuer in North America remains on track to buy back $225 million shares in 2019. In the first quarter of 2019, the company increased the quarterly dividend by 36% making it an attractive pick for yield-seeking investors.

Primerica’s return on equity was 22.8% in the trailing 12-month period, higher than the industry average of 9.9%. Return on equity is a profitability measure that identifies the company’s efficiency in utilizing its shareholders’ funds. 

The Zacks Consensus Estimate for the company’s 2019 and 2020 earnings indicates improvement of 11.9% and 11.8%, respectively from the year-ago reported figure.

Stocks to Consider

Some better-ranked insurers include Cigna (CI - Free Report) , Health Insurance Innovations (HIIQ - Free Report) and Assurant (AIZ - Free Report) .

Cigna provides insurance and related products and services in the United States and internationally. The company delivered positive surprise of 15.28% in the last reported quarter. The stock carries a Zacks Rank #2 (Buy).

Health Insurance Innovations operates as a cloud-based technology platform and distributor of individual and family health insurance plans, and supplemental products in the United States. The company delivered positive surprise of 104.00% in the last reported quarter. The company sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Assurant provides risk management solutions for housing and lifestyle markets in North America, Latin America, Europe, and the Asia Pacific. The company delivered positive surprise of 9.86% in the last reported quarter. The stock carries a Zacks Rank #2.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

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