On Dec 30, Zacks Investment Research upgraded StanCorp Financial Group Inc. (SFG) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
StanCorp Financial witnessed an increase in earnings estimates following the announcement of a dividend hike and solid third-quarter earnings.
Last month, the board of directors of StanCorp Financial approved an 18.2% hike in its annual dividend to $1.30 per share. Its dividend currently yields 1.84%, which is better than the industry average of 1.61%. In fact the latest hike marks the fifteenth in a row.
With respect to earnings results, the company delivered operating net earnings of $1.73 per share in the third quarter, outperforming the Zacks Consensus Estimate by 31% and improving 19.3% year over year. Favorable claims experience in Employee Benefits along with the benefit of pricing actions drove the outperformance.
Asset Management continues to perform well, adding to the upside. The life insurer delivered positive surprise in the two of last four quarters with an average beat of 7.71%.The quarter also experienced lower expenses. An unprecedented improvement in Employee Benefit ratio marked this as the best quarter since the company went public. Management guided benefit ratio between 77% and 79% for 2014.
These positives resulted in an upward revision in the Zacks Consensus Estimate for 2014 that moved north by 1.2% to $5.21 in the last 60 days. The expected earnings growth rate for the stock is 5.3%.
Other Stocks to Consider
Investors interested in life insurers can also look at American Equity Investment Life Holding Co. (AEL), Lincoln National Corp. (LNC) and Protective Life Corp. (PL). While American Equity shares the Zacks Rank with StanCorp Financial, Lincoln National and Protective Life carry a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment