Insurance Notes: Prudential, MetLife, Manulife

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Prudential Financial

In this note we review some developments in the insurance sector during the last week. First, we take a look at the latest addition to Prudential’s (NYSE:PRU) reinsurance business in the U.K. Also covered below are details of Manulife’s (NYSE:MFC) investments in improving operating efficiency and MetLife’s increased dividend.

Prudential On Growth Trajectory As New Business Pours In

Last week, Prudential’s longevity risk reinsurance business arm, Prudential Insurance Company of America (PICA)  signed an agreement with U.K.-based Pension Insurance Corporation plc (PIC). [1] According to the agreement, PICA will provide reinsurance to PIC’s pension liabilities that cover over 6,700 pension fund beneficiaries. This is part of Prudential’s strategy to expand the company’s reinsurance and pension risk transfer business outside of the U.S. The company has already signed a slew of large deals in the U.S. including with General Motors (NYSE:GM), Verizon (NYSE:VZ), Bristol-Myers Squibb (NYSE:BMY) and Kimberly Clark (NYSE:KMB).

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We have a price estimate of $86 for Prudential’s stock, which translates to a valuation of about $39 billion.

See our full analysis of Prudential here

Manulife Invests In Technology

Last week, Manulife’s American brand John Hancock formed a strategic partnership with Synodex in order to improve its operating efficiency. The agreement involves Manulife licensing Synodex’s software and will help the company optimize and streamline its internal processes as well as make underwriting more efficient. [2] Synodex is an Indonesian company that provides services to insurance and reinsurance companies for better risk assessment.

We have a price estimate of $19 for Manulife’s stock, valuing the company at about $37 billion.

See our full analysis of Manulife here

MetLife Increases Quarterly Dividend

On April 28, MetLife’s board of directors confirmed a common stock dividend of $0.375 per share for the second quarter of 2015. This is about 7% higher than the dividend paid during the first quarter of 2015. [3]

We have a price estimate of $57 for MetLife’s stock, which translates to a valuation of about $62 billion.

See our full analysis of MetLife here

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Notes:
  1. PICA announces first longevity reinsurance transaction with Pension Insurance Corp. plc, Prudential Press Release []
  2. John Hancock Insurance Announces Strategic Relationship with Synodex, Manulife Press Release []
  3. MetLife Increases Second Quarter 2015 Common Stock Dividend by 7 Percent, MetLife Press Release []