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McKinney, Texas-based Globe Life Inc. (GL) provides various life and supplemental health insurance products, and annuities to lower-middle and middle-income families. With a market cap of $8.8 billion, Globe Life operates through the Life Insurance, Supplemental Health Insurance, Annuities, and Investments segments.
The insurance major has substantially underperformed the broader market over the past year. Over the past 52 weeks, GL stock dipped 13.5% compared to the S&P 500 Index’s ($SPX) 27.8% returns. In 2024 alone, GL is down 19.9% versus SPX’s 17.8% gains on a YTD basis.
Zooming in further, GL has also underperformed the S&P Insurance ETF SPDR’s (KIE) 29.9% returns over the past 52 weeks and 20% gains on a YTD basis.
Shares of Globe Life plummeted 53.1% on Apr. 11 after Fuzzy Panda Research disclosed a short position in the company, alleging multiple instances of insurance fraud. The company executives refuted Fuzzy Panda’s report and asserted the allegations are “driven solely by short-term profit.” GL stock rebounded 20.2% in the following trading session and has largely recovered the initial drop till now.
More recently, GL rose marginally in the trading session following the release of its Q2 earnings on Jul. 24. The company reported a 13.8% yearly growth in EPS to $2.97 while surpassing the consensus estimates by 2.4%.
For the current fiscal year, ending in December, analysts expect Globe Life to report an EPS growth of 11.9% to $11.92. The company’s earnings surprise history is mixed. It beat the consensus estimates in three of the past four quarters while missing on another occasion.
Among the nine analysts covering the GL stock, the consensus rating is a “Moderate Buy.” That’s based on four “Strong Buy” ratings, one “Moderate Buy,” and four “Holds.”
This configuration has been consistent over the past months.
On Jul. 26, Wells Fargo (WFC) analyst Elyse Greenspan maintained an “Overweight” rating with a price target of $108.
GL’s mean price target of $109.40 represents a premium of 12.2% from current price levels. The Street-high target of $160 indicates a potential upside of 64.1%.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
