Tags: MetLife | MET | American International Group | AIG | insurance | annuities | stock

MetLife Positioned to Grow Abroad

By    |   Wednesday, 22 Jun 2011 09:56 AM

MetLife (MET) sells more peace of mind than almost every other provider of insurance and annuities on the planet. MetLife began the year serving more than 90 million customers in more than 60 countries.

The mammoth New York City-based insurer sells life and health coverage, including dental and disability policies, plus auto and home insurance, as well as variable and fixed annuities and employee benefit programs.

The company earned $830 million of net income in the first quarter, up from $805 million in the same period last year. Revenues in the January to March period jumped to $15.9 billion from $13.1 billion in last year's first quarter, thanks largely to a major acquisition.

While MetLife collects most of its premiums, fees, and other revenues in the United States, its smaller international operation has grown dramatically since the company's November 2010 acquisition of Alico, also known as American Life Insurance Company. MetLife paid American International Group (AIG) $16.2 billion for Alico, a key deal that significantly extended MetLife's presence abroad.

Another big change is in the management team. Steven A. Kandarian became the CEO of MetLife in May, succeeding C. Robert Henrikson, who will continue as chairman through the end of the year while working with Kandarian during the transition. MetLife also named Steve Goulart as its new chief financial officer in May.

On the company's first-quarter conference call with stock analysts, Kandarian said MetLife will continue to seek revenue growth in the economically flattened U.S. market without sacrificing profit margins in the process.

"While the lack of growth in the U.S. marketplace is frustrating, I am very pleased with our margins, which are a direct result of our disciplined pricing and our focus on risk management," Kandarian said.

Improving returns

Most securities analysts who were following MetLife recommended buying the company's stock as midyear approached.

Bank of America subsidiary Merrill Lynch issued a buy rating on MetLife stock, citing the company's ability to improve its return on equity by returning cash to shareholders through dividends and stock buybacks. MetLife had cash and liquid assets totaling $2.5 billion at the end of March.

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MetLife (MET) sells more peace of mind than almost every other provider of insurance and annuities on the planet. MetLife began the year serving more than 90 million customers in more than 60 countries. The mammoth New York City-based insurer sells life and health...
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2011-56-22
Wednesday, 22 Jun 2011 09:56 AM
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