Hot stock to watch: Globe Life Inc (NYSE: GL)

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Globe Life Inc (NYSE: GL) stock rose 0.2% on 5th Feb, 2020 (as of 10:36 am GMT-5 ; Source: Google finance) after the company posted mixed results for the fourth quarter of FY 19. Net operating income for the quarter has increased to $1.70 per diluted common share, compared with $1.56 per diluted common share for the year-ago quarter. Life insurance had accounted for 74% of the Company’s insurance underwriting margin for the quarter and 70% of total premium revenue.  Health insurance had accounted for 25% of the Company’s insurance underwriting margin for the quarter and 30% of total premium revenue. Net sales of life insurance grew 7%, while net health sales grew 13%

Moreover, the company’s net investment income grew 1%, while average invested assets grew 4%. Required interest on net policy liabilities grew 4%, while average net policy liabilities grew 3%. The weighted average discount rate for the net policy liabilities was 5.7% and was in line with the year-ago quarter. Further, the market value of Globe Life’s fixed maturity portfolio was $18.9 billion compared to the amortized cost of $16.4 billion. Net unrealized gains were comprised of gross unrealized gains of $2.6 billion and gross unrealized losses of $83 million.

GL in the fourth quarter of FY 19 has reported the adjusted earnings per share of $1.70, missing the analysts’ estimates for the adjusted earnings per share of $1.72, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 35.9 percent to $1.13 billion in the fourth quarter of FY 19, beating the analysts’ estimates for revenue by 0.41%.

The company reported the net income as an ROE of 11.6% for the year ended December 31, 2019. Net operating income as an ROE excluding net unrealized gains on fixed maturities was 14.5% for the same period. The company’s life underwriting margin at the American Income Life Division rose over the year-ago quarter by 9%. Life premiums grew over the year-ago quarter by 8% at the American Income Life Division. Health premiums grew over the year-ago quarter by 8% at the Family Heritage Division. Life net sales at the Liberty National Division and American Income Life Division grew over the year-ago quarter by 13% and 9%, respectively. Total health net sales grew over the year-ago quarter by 13%.

Additionally, during the quarter, the Company had repurchased 930,044 shares of Globe Life Inc. common stock at a total cost of $93 million for an average share price of $99.82.

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