AFLAC’s Strong Japanese Market Performance and Operational Efficiency in the U.S. Justify Buy Rating Despite EPS Miss

Analyst Joshua Shanker from Bank of America Securities reiterated a Buy rating on AFLAC (AFL – Research Report) and decreased the price target to $118.00 from $122.00.

Joshua Shanker has given his Buy rating due to a combination of factors, including AFLAC’s strong performance in the Japanese market and favorable claims and expense ratios in the U.S. Despite a slight miss in the adjusted EPS compared to his estimates, AFLAC’s results were in line with consensus expectations. The company’s robust sales growth in Japan, particularly driven by new product offerings, and improved persistency rates contribute positively to the outlook.
In the U.S., AFLAC’s favorable benefits and expense ratios, despite increased spending on growth initiatives, indicate operational efficiency. Although there is a decline in forward EPS forecasts due to lower investment income expectations, this is partially offset by a reduced share count. The potential upside to the price objective, which is slightly adjusted to $118, supports the reiteration of the Buy rating, as it reflects confidence in AFLAC’s ability to navigate current market conditions and deliver shareholder value.

AFL’s price has also changed slightly for the past six months – from $110.090 to $108.680, which is a -1.28% drop .