Upgrading to Overweight
MET has dramatically transformed its business model over the past year with a shift to faster-growing, capital-lite businesses. Furthermore, we anticipate that organic revenue growth will accelerate in 2018 as rising employment boosts group life sales and pension risk transfers continue their rapid growth. Multiple factors point to rising interest rates, which should also provide a positive tailwind for earnings growth. MET now trades at only 0.9x FY19 BVPS despite our forecast for a 12% ROE in FY19. We have increased our valuation and price target to $60, implying over 30% upside. Given the restructuring, favourable market dynamics and compelling valuation we are upgrading to an Overweight rating.MetLife, through its subsidiaries and affiliates, provides insurance, annuities, employee benefits and asset management. The company's segments include: United States; Asia; Latin America; Europe, the Middle East and Africa; and MetLife Holdings. In the United States, the company provides a variety of insurance and financial services products, including life, dental, disability, property and casualty, guaranteed interest, stable value and annuities to both individuals and groups. Outside the United States, the company provides life, medical, dental, credit and other accident and health insurance, as well as annuities, endowment and retirement and savings products to both individuals and groups.
Formed in 2003 by an established team from Cazenove, one of the most respected investment banks in the UK, Atlantic Equities conducts and publishes fundamental, bottom up research on mid and large cap US companies.
Atlantic provide order execution through a wide range of DMA products and algorithmic trading suites.
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