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Metlife (MET)
NYSE:MET
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Metlife
(NYSE:MET)65Neutral
Positive Factors
Investment Income
Higher private equity returns led to an outperformance in net investment income, which exceeded forecasts.
Pension Risk Transfer Sales
Pension Risk Transfer sales of $2.5bn showed 39% YoY growth, a positive surprise despite expectations for lumpiness.
Negative Factors
Earnings Performance
The 2025 outlook reflects weaker year-over-year earnings from MetLife Holdings, Corporate, and FX.
Metlife (MET) vs. S&P 500 (SPY)
Market Cap
$58.71B
Dividend Yield2.54%
Average Volume (3M)3.61M
Price to Earnings (P/E)14.5
Beta (1Y)0.92
Revenue Growth6.10%
EPS Growth225.22%
CountryUS
Employees45,000
SectorFinancial
Sector Strength93
IndustryInsurance
Share Statistics
EPS (TTM)5.96
Shares Outstanding681,228,000
10 Day Avg. Volume3,270,027
30 Day Avg. Volume3,613,552
Financial Highlights & Ratios
PEG Ratio0.06
Price to Book (P/B)N/A
Price to Sales (P/S)0.83
Price to Cash Flow (P/CF)3.20
P/FCF Ratio3.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$98.36Price Target Upside20.60% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering11
Metlife Business Overview & Revenue Model
Company DescriptionHeadquartered in New York, MetLife, Inc. is among the largest global providers of insurance and financial services to individual and institutional customers. It offers life insurance, annuities, employee benefits and asset management services. The company operates through the following segments: U.S., Asia, Latin America, Europe, the Middle East and Africa (EMEA), and MetLife Holdings.
How the Company Makes MoneyMetLife generates revenue primarily through the collection of premiums from its diverse range of insurance products, including life, dental, disability, and accident & health insurance. In addition to premium income, the company earns money through investment income, leveraging its substantial portfolio of invested assets. These investments include fixed income securities, equities, real estate, and other financial instruments. MetLife also benefits from fees and charges associated with its annuity and retirement products, as well as from its employee benefits solutions offered to corporate clients. The company's earnings are influenced by factors such as interest rates, underwriting results, and claims experience, as well as its strategic partnerships and acquisitions that enhance its market presence and product offerings.
Metlife Financial Statement Overview
Summary
Metlife shows strong revenue growth and increased net income, but its balance sheet reveals significant financial instability with negative equity and reduced asset base. Declining operating cash flow indicates potential liquidity issues, despite stable free cash flow.Income Statement
Metlife's income statement reflects a healthy revenue base with a recent increase from $66.4 billion in 2023 to $70.9 billion in 2024, indicating a positive revenue growth trend. While net income also grew significantly from $1.58 billion to $4.43 billion, the net profit margin remains modest. However, the lack of reported EBIT and EBITDA margins in 2024 limits a comprehensive profitability analysis.75
Positive
Balance Sheet
The balance sheet reveals potential financial instability, with negative stockholders' equity of -$41.66 billion in 2024, resulting in a concerning equity ratio. The debt-to-equity ratio calculation is impractical due to negative equity, representing a high-risk leverage position. The significant decrease in total assets from 2023 to 2024 further exacerbates the concerns.40
Negative
Cash Flow
Metlife's cash flow statements show a decline in operating cash flow from $13.72 billion in 2023 to $4.73 billion in 2024, indicating a potential cash generation issue. However, free cash flow remained stable at $4.73 billion, suggesting effective management of capital expenditures. The operating cash flow to net income ratio was favorable in 2023, but deteriorated in 2024.65
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 71.35B | 70.99B | 66.41B | 69.90B | 71.08B | 67.84B | Gross Profit |
| 71.35B | 70.99B | 65.91B | 69.90B | 71.08B | 67.84B | EBIT |
| 5.29B | 0.00 | 66.90B | 3.10B | 5.49B | 5.07B | EBITDA |
| -1.42B | 0.00 | 3.92B | 7.97B | 10.13B | 8.46B | Net Income Common Stockholders |
| 3.76B | 4.43B | 1.58B | 2.35B | 6.86B | 5.41B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 0.00 | 0.00 | 302.05B | 301.91B | 367.50B | 378.51B | Total Assets |
| -23.72B | -23.72B | 687.58B | 666.61B | 759.71B | 795.15B | Total Debt |
| 1.17B | 1.17B | 18.83B | 17.98B | 17.43B | 18.15B | Net Debt |
| 1.17B | 1.17B | -1.81B | -2.21B | -2.62B | -1.65B | Total Liabilities |
| 17.94B | 17.94B | 657.33B | 639.32B | 691.96B | 720.33B | Stockholders Equity |
| -41.66B | -41.66B | 30.02B | 27.04B | 67.48B | 74.56B |
| Cash Flow | Free Cash Flow | ||||
| 14.79B | 4.74B | 13.72B | 13.20B | 16.96B | 7.37B | Operating Cash Flow |
| 15.17B | 4.74B | 13.72B | 13.20B | 12.60B | 11.64B | Investing Cash Flow |
| -5.55B | -791.00M | -10.25B | -2.62B | -11.19B | -18.57B | Financing Cash Flow |
| -2.79B | -4.81B | -2.94B | -10.11B | -1.38B | 10.73B |
Metlife Technical Analysis
Negative
81.56
Price Trends
83.16
Negative
83.01
Negative
77.83
Positive
Market Momentum
-0.05
Negative
43.38
Neutral
62.68
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MET, the sentiment is Negative. The current price of 81.56 is below the 20-day moving average (MA) of 83.15, below the 50-day MA of 83.16, and above the 200-day MA of 77.83, indicating a neutral trend. The MACD of -0.05 indicates Negative momentum. The RSI at 43.38 is Neutral, neither overbought nor oversold. The STOCH value of 62.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MET.
Metlife Risk Analysis
Metlife disclosed 46 risk factors in its most recent earnings report. Metlife reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Metlife Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $10.68B | 10.67 | 20.18% | 0.75% | 6.07% | 17.69% | |
75 Outperform | $14.55B | 8.70 | 16.23% | 2.00% | 4.03% | 45.42% | |
71 Outperform | $47.38B | 15.77 | -3.30% | 1.89% | -28.56% | 1.14% | |
67 Neutral | $6.11B | 1.95 | 39.61% | 4.75% | 47.95% | ― | |
65 Neutral | $58.71B | 14.50 | 16.13% | 2.54% | 6.10% | 225.22% | |
64 Neutral | $14.34B | 10.61 | 9.28% | 4.07% | 18.04% | -9.54% | |
61 Neutral | $38.79B | 14.61 | 9.79% | 4.63% | 34.25% | 11.22% |
* Financial Sector Average
Performance Comparison
MET
Metlife
81.56
13.12
19.17%
AIG
American International Group
79.85
7.48
10.34%
LNC
Lincoln National
35.88
11.03
44.39%
PRU
Prudential Financial
109.59
5.39
5.17%
GL
Globe Life
124.15
-0.96
-0.77%
UNM
Unum Group
77.91
28.78
58.58%
Metlife Earnings Call Summary
Earnings Call Date: Feb 5, 2025 | % Change Since: -4.05% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Positive
The earnings call reflects a generally positive outlook for MetLife with robust growth strategies, strategic partnerships, and strong financial performance. However, there are some challenges noted, especially in specific segments like group benefits and RIS, and currency headwinds affecting international operations.Highlights
Outperformance of Stock
MetLife, Inc.'s stock outperformed the Standard and Poor's 500 index in 2024, demonstrating strong market recognition of its performance.
Introduction of New Frontier Strategy
MetLife rolled out its New Frontier strategy, focusing on growth with four strategic priorities: extending leadership in group benefits, capitalizing on the retirement platform, accelerating growth in asset management, and expanding in high-growth international markets.
Significant Transactions and Partnerships
MetLife announced the formation of Cherry Tree, a Bermuda-based life and annuity reinsurance company, in partnership with General Atlantic and Chubb as an anchor investor. Additionally, MetLife acquired PineBridge Investments and certain teams from Mesero Financial.
Strong Financial Metrics and Goals
Double-digit adjusted EPS growth targeted, with adjusted return on equity range increased to 15%-17%. Commitment to $25 billion of free cash flow over five years, up from $20 billion.
Fourth Quarter and Full Year Results
Fourth quarter adjusted earnings of $1.5 billion, or $2.09 per share, up 14% from the prior year. Full year adjusted earnings of $5.8 billion.
Group Benefits and International Growth
Group benefits business generated adjusted earnings of $1.7 billion in 2024 with full-year sales up 8%. Asia and Latin America also showed strong performance with significant earnings growth.
Lowlights
Group Benefits Earnings Decrease
Q4 2024 group benefits adjusted earnings were $416 million, down 11% from the prior year due to less favorable nonmedical health underwriting margins.
RIS Earnings Decline
Retirement and Income Solutions (RIS) adjusted earnings for Q4 2024 were $386 million, down 8% year-over-year, due to lower recurring interest margins and less favorable underwriting.
Challenges in Asia Sales
Asia sales were down 5% in 2024 on a constant currency basis, primarily due to lower Japan sales affected by yen volatility.
Corporate and Other Adjusted Loss
Corporate and other adjusted loss was $209 million versus an adjusted loss of $156 million in the prior year, due to higher expenses and taxes.
Alternative Return Assumptions
The private equity and real estate returns in 2024 were lower than expected, leading to an increase in alternative return assumptions for 2025.
Company Guidance
During the MetLife Fourth Quarter and Full Year 2024 earnings call, the company provided comprehensive guidance for the near term, highlighting several key financial metrics and strategic priorities. MetLife introduced its New Frontier strategy, which aims for double-digit adjusted earnings per share (EPS) growth, with a 60% contribution from business and margin growth and the rest from disciplined capital management. The company increased its adjusted return on equity (ROE) target range to 15% to 17% and committed to reducing its direct expense ratio by 100 basis points from the previous 12.3% target, aiming for 11.3% by 2029. Furthermore, MetLife plans to generate $25 billion in free cash flow over the next five years. For 2025, the company expects adjusted earnings to be buoyed by higher investment income and continued change in product mix, with specific targets including a corporate and other adjusted loss range of $850 to $950 million after tax and a maintained effective tax rate of 24% to 26%. The guidance also reflected a focus on strategic priorities, such as expanding leadership in group benefits, capitalizing on the retirement platform, accelerating asset management growth, and expanding in high-growth international markets.Metlife Corporate Events
Executive/Board Changes
MetLife Announces Leadership Changes and Board Expansion
Neutral
Feb 27, 2025
On January 7, 2025, MetLife announced the resignation of Tamara L. Schock as Executive Vice President and Chief Accounting Officer, effective March 15, 2025. Toby Srihiran Brown was appointed as the interim Chief Accounting Officer while a search for a permanent replacement is conducted. Additionally, on February 25, 2025, MetLife’s Board of Directors expanded from thirteen to fourteen members, electing Christian Mumenthaler as an independent director effective May 1, 2025, and appointing him to the Finance and Risk Committee and the Investment Committee.
Business Operations and StrategyFinancial Disclosures
MetLife Reports Strong 2024 Financial Performance
Positive
Feb 5, 2025
MetLife, Inc. announced its financial results for the full year and fourth quarter of 2024 on February 5, 2025. The company reported a significant increase in net income, rising to $4.2 billion from $1.4 billion in the previous year, with adjusted earnings also showing growth. MetLife’s return on equity and adjusted return on equity were strong, and the company surpassed its five-year commitments, positioning it for future growth under its New Frontier strategy.
Executive/Board Changes
MetLife Announces Resignation of Chief Accounting Officer
Neutral
Jan 10, 2025
MetLife, Inc. announced that Executive Vice President and Chief Accounting Officer Tamara L. Schock will resign to pursue another opportunity, with her last day expected around March 14, 2025. Her resignation is due to personal reasons, not disagreements regarding the company’s financial practices or policies.
Business Operations and StrategyFinancial Disclosures
MetLife Unveils New Frontier Growth Strategy
Positive
Dec 12, 2024
MetLife announced its New Frontier growth strategy at its 2024 Investor Day, aiming for double-digit adjusted earnings per share growth and a 15-17% adjusted return on equity over the next five years. The strategy focuses on enhancing leadership in Group Benefits, leveraging its retirement platform in the U.S. and Japan, expanding asset management capabilities, and targeting growth in high-potential international markets. These commitments position MetLife to deliver growth and returns with lower risk, supporting stakeholders with a strong value proposition.
Private Placements and FinancingBusiness Operations and Strategy
MetLife Partners with General Atlantic for Chariot Reinsurance
Positive
Dec 11, 2024
MetLife, Inc. and General Atlantic announced the creation of Chariot Reinsurance, Ltd., an offshore reinsurance company set to launch in Bermuda in the first half of 2025. MetLife aims to initially cede approximately $10 billion in statutory reserves to Chariot Re, which will be managed by MetLife Investment Management and General Atlantic, boosting MetLife’s available capital by around $1 billion. This initiative aligns with MetLife’s strategy to expand its reinsurance capabilities and is expected to strengthen its market positioning while maintaining its commitment to existing policyholders.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.