On Mar 07, 2014, shares of Protective Life Corp. (PL) hit a 52-week high of $54.05. The momentum was driven by strong operating performance exhibited by the company in its recently reported fourth quarter and full year earnings results as well as a rating affirmation by A.M. Best.
Protective Life reported earnings of $1.43 per share handily beating the Zacks Consensus Estimate by 31 cents per share. The better-than-expected results came on the back of higher contribution from all of the company’s segments – Life Marketing, Acquisitions, Annuities, Stable Value Products as well as Asset Protection. The company posted positive earnings surprises in three of the last four reported quarters with an average beat of 6.91%.
In 2014, we expect the company’s earnings to benefit from the recently closed acquisition of MONY Life Insurance Company. The acquisition is expected to add 10 to 15 cents per share to Protective Life’s 2014 earnings while expanding its life insurance portfolio and enhancing its market share.
Other efforts made by the company, which include innovative retail growth initiatives, focus on careful and rational allocation of capital and constant attention toward rigorous expense management will help it emerge strongly over time.
In addition, the gradually increasing interest rate environment also bodes well for the company’s investment income which had otherwise been underperforming.
Moreover, this life insurer with a Zacks Rank #2 (Buy) boasts of solid asset quality and overall sound capital position, liquidity and financial flexibility alongside robust enterprise risk management which drives credit rating agencies to assign it a strong credit score.
Protective Life also outperformed the one-year S&P 500, which posted a return of 21.1% against a return of 58.8% clocked by the company.
Other stocks such as Lincoln National Corporation (LNC), Primerica, Inc. (PRI), Symetra Financial Corporation (SYA) all carrying the same rank as Protective Life are worth considering.