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Should You Add Reinsurance Group (RGA) Stock to Portfolio?
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Shares of Reinsurance Group of America, Incorporated (RGA - Free Report) have gained momentum recently. Is it time to add the Zacks Rank #3 (Hold) life insurer to your portfolio?
Factors to Consider
Reinsurance Group, which holds an industry-leading position in the U.S. and Latin American traditional markets, has been successful in expanding its product line with top-notch services, capabilities, and innovation. More importantly, product line expansion would also facilitate risk diversification going ahead. In addition, the company’s experienced management team continues to work effectively in terms of block transactions, which should help the insurer generate 4% to 6% growth in this region in the future.
Moreover, the life insurer has carved out a niche in the Canadian market on the back of its solid growth and profitability. Notably, the company anticipates longevity insurance, which provides a source of diversified income, to experience steady demand and long-term growth in the Canadian market. Apart from maintaining its leading position in the Canadian market for the seventh consecutive year, the Reinsurance Group expects growth rates of 5–8% for premiums and 8–10% for earnings from the Canadian segment by 2016.
Despite a challenging overall operating environment, the company has been witnessing sustained premium growth. This reflects the resilience of the company’s operating model and its ability to capitalize on opportunities and strong market positions.
The company boasts diverse sources of earnings as its operations are spread across geographies and it has multiple product lines. This, in turn, has been supporting the insurer’s solid bottom-line growth. Moreover, the company’s top-line growth continues to impress amid a competitive environment. Therefore, the life insurer remains well positioned to take advantage of the considerable opportunities that exist in the market.
Year to date, the Reinsurance Group stock has gained 43.4%, which compares favorably with the Zacks categorized Life Insurance industry’s decline of 0.5%. The above-mentioned growth drivers contributed to this outperformance. Also, the execution of the company’s strategy to drive organic growth has led to the stellar year-to-date overall results. In addition, the company has witnessed upward revision of its full-year 2016 estimates over the last 60 days.
The long-term expected earnings growth is pegged at 9%. Also, the price earnings growth ratio, which determines the relative trade-off between the price of a stock, the earnings generated per share, and the company's expected growth, is 1.42. This is better than the industry average of 1.25. Notably, Reinsurance Group carries a VGM score of B. Here V stands for Value, G for Growth and M for Momentum and the score is a weighted combination of these three scores.
Stocks to Consider
Some better-ranked stocks from the same space are Health Insurance Innovations, Inc. , Primerica, Inc. (PRI - Free Report) and Universal American Corp. .
Health Insurance Innovations operates as a developer, distributor, and administrator of cloud-based individual health and family insurance plans, and supplemental products in the U.S. The company delivered positive surprises in all of the last four quarters with an average beat of 270.84%. The company sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Primerica distributes financial products to middle-income households in the U.S. and Canada. The company delivered positive surprises all of the last four quarters with an average beat of 6.37%. The company holds a Zacks Rank #2 (Buy).
Universal American provides health insurance and managed care products and services to Medicare and Medicaid customers in the U.S. The company delivered positive surprise one of the last four quarters but with an average miss of 231.25%. The company holds a Zacks Rank #2.
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How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>
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Should You Add Reinsurance Group (RGA) Stock to Portfolio?
Shares of Reinsurance Group of America, Incorporated (RGA - Free Report) have gained momentum recently. Is it time to add the Zacks Rank #3 (Hold) life insurer to your portfolio?
Factors to Consider
Reinsurance Group, which holds an industry-leading position in the U.S. and Latin American traditional markets, has been successful in expanding its product line with top-notch services, capabilities, and innovation. More importantly, product line expansion would also facilitate risk diversification going ahead. In addition, the company’s experienced management team continues to work effectively in terms of block transactions, which should help the insurer generate 4% to 6% growth in this region in the future.
Moreover, the life insurer has carved out a niche in the Canadian market on the back of its solid growth and profitability. Notably, the company anticipates longevity insurance, which provides a source of diversified income, to experience steady demand and long-term growth in the Canadian market. Apart from maintaining its leading position in the Canadian market for the seventh consecutive year, the Reinsurance Group expects growth rates of 5–8% for premiums and 8–10% for earnings from the Canadian segment by 2016.
Despite a challenging overall operating environment, the company has been witnessing sustained premium growth. This reflects the resilience of the company’s operating model and its ability to capitalize on opportunities and strong market positions.
The company boasts diverse sources of earnings as its operations are spread across geographies and it has multiple product lines. This, in turn, has been supporting the insurer’s solid bottom-line growth. Moreover, the company’s top-line growth continues to impress amid a competitive environment. Therefore, the life insurer remains well positioned to take advantage of the considerable opportunities that exist in the market.
Year to date, the Reinsurance Group stock has gained 43.4%, which compares favorably with the Zacks categorized Life Insurance industry’s decline of 0.5%. The above-mentioned growth drivers contributed to this outperformance. Also, the execution of the company’s strategy to drive organic growth has led to the stellar year-to-date overall results. In addition, the company has witnessed upward revision of its full-year 2016 estimates over the last 60 days.
The long-term expected earnings growth is pegged at 9%. Also, the price earnings growth ratio, which determines the relative trade-off between the price of a stock, the earnings generated per share, and the company's expected growth, is 1.42. This is better than the industry average of 1.25. Notably, Reinsurance Group carries a VGM score of B. Here V stands for Value, G for Growth and M for Momentum and the score is a weighted combination of these three scores.
Stocks to Consider
Some better-ranked stocks from the same space are Health Insurance Innovations, Inc. , Primerica, Inc. (PRI - Free Report) and Universal American Corp. .
Health Insurance Innovations operates as a developer, distributor, and administrator of cloud-based individual health and family insurance plans, and supplemental products in the U.S. The company delivered positive surprises in all of the last four quarters with an average beat of 270.84%. The company sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Primerica distributes financial products to middle-income households in the U.S. and Canada. The company delivered positive surprises all of the last four quarters with an average beat of 6.37%. The company holds a Zacks Rank #2 (Buy).
Universal American provides health insurance and managed care products and services to Medicare and Medicaid customers in the U.S. The company delivered positive surprise one of the last four quarters but with an average miss of 231.25%. The company holds a Zacks Rank #2.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>