Insurance Weekly Notes: MetLife, Travelers, Prudential

+8.46%
Upside
72.55
Market
78.69
Trefis
MET: MetLife logo
MET
MetLife

In this note we review the week ended December 12 for insurance companies MetLife (NYSE: MET), Travelers (NYSE:TRV) and Prudential (NYSE:PRU). MetLife named a new head of its global marketing operations, while Travelers announced its expansion plans in Latin America with an acquisition of a surety provider company in Columbia.

MetLife

In order to further strengthen its focus on customers, MetLife announced the appointment of Esther Lee as the company’s Global Chief Marketing Officer. [1] According to the company press release, she will manage all aspects of global marketing, advertising and promotion for MetLife. The company hopes to gain from her extensive experience in managing brand and marketing dynamics at the international level for companies such as AT&T (NYSE:T) and Coca Cola (NYSE: KO). The appointment is MetLife’s latest effort to better integrate branding into its overall business strategy.

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Effective branding and marketing of different products is important for any insurance company. From distribution channels to the direct marketing of products on employers’ websites, MetLife deploys various marketing techniques to reach the target customer segment. The company also makes use of direct marketing, with the strategies varying across geographies, customer demographics and the product being sold. [2]

MetLife’s stock lost the gains made early in the week. Down by more than 2% at the end of Thursday’s trading hours, the company’s stock is now about 10% below our price estimate of $59.

See our Complete Analysis of MetLife here

Travelers

Earlier in the week, Travelers announced the acquisition of a majority stake in Colombian surety provider start-up Cardinal Compañía de Seguros. The acquisition will be carried out through Travelers’ joint venture with J. Malucelli in Brazil. The transaction is expected to close in the second quarter of 2015. [3] The joint venture in Brazil holds a leading position in the surety insurance market in the country, with a nearly 30% share. [4]

Travelers’ stock traded flat during the week. The current market price is slightly lower than our estimate of $109 for the company’s stock.

See Complete Analysis for Travelers Here

Prudential

Prudential held its annual conference call to discuss its financial outlook for 2015. The company provided EPS guidance of $9.60-10.10 for 2015 compared to $10 for the current calendar year. [5]

The company opened the week’s trading at $89 and by market close on Thursday had gained over 2% to touch $90. We have a price estimate of $102 for Prudential’s stock, valuing the company at $47 billion.

See our Complete Analysis of Prudential here

Notes:
  1. ESTHER LEE TO JOIN METLIFE AS GLOBAL CHIEF MARKETING OFFICER, MetLife Press Release []
  2. SEC 10-K Filing []
  3. Travelers’ Joint Venture with J. Malucelli to Acquire Majority Interest in Colombian Surety Start-Up, Travelers Press Release []
  4. Travelers Increases Its Ownership in Its J. Malucelli Joint Venture, the Market Leader in Brazilian Surety, Travelers Press Release []
  5. 2015 Financial Outlook, Prudential Investor Relations []