U.S. Markets open in 6 hrs 25 mins

Genworth Financial Poised to Grow on Strategic Initiatives

Zacks Equity Research

Genworth Financial, Inc. GNW saw its shares gaining 42.24% over the last one year, significantly underperforming the Life Insurance industry’s growth of 17.74%. The company remains poised for growth owing to a number of positives.


Genworth offers insurance and homeownership solutions in the U.S. and worldwide. The company has maintained its industry-leading position in the nation through the diversification of its international presence. The insurer caters to the life and lifestyle protection, retirement income, investment and mortgage insurance needs of its customers.

The life insurer remains optimistic about its pending acquisition by China Ocenawide, which is expected to improve value for its customers through better services than what Genworth currently offers. Therefore, Genworth is set to reap benefits from this buyout, which in turn, will accelerate its growth in the long term. Genworth will remain focused toward its key financial priorities of strengthening the balance sheet and stabilizing and improving ratings over time, particularly in its U.S. MI business

Moreover, the Zacks Rank #2 (Buy) life insurer’s mortgage insurance segment has been generating profits after incurring losses over a extended period. This apart, the company’s U.S. Mortgage Insurance business has been displaying better results, mainly driven by lower new delinquency development and effective loss mitigation programs as well as changes in aging of existing delinquencies.

In addition, Genworth aimed to lower cash expenses by $150 million by the end of 2016 in U.S. Life Insurance. Also, the company is intensifying focus on streamlining and rationalizing business to mainly improve performance, enhance financial and strategic flexibility.

Interestingly, Genworth Financial 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. The company also has witnessed 2017 estimates moving up by 1.1% in the last 60 days.

Other Stocks That Wattant a Look

Investors interested in the same space might consider other well-ranked stocks like Health Insurance Innovations, Inc. HIIQ Reinsurance Group of America, Incorporated RGA and Primerica, Inc. PRI.

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%. It sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Reinsurance Group deals in reinsurance business. The company has delivered positive surprises in three of the last four quarters with an average beat of 8.61%. The life insurer holds a Zacks Rank #2.

Primerica distributes financial products to middle income households in the U.S. and Canada. The company has delivered positive surprises in all of the last four quarters with an average beat of 6.37%. 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 >>