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Globe Life Inc. (GL), with a market cap of $7.5 billion, is a financial services holding company headquartered in McKinney, Texas. It operates through its subsidiaries that offer life insurance, annuities, and supplemental health insurance products. The company is expected to announce its fiscal Q2 earnings results on Wednesday, Jul. 24.
Ahead of the event, analysts expect Globe Life to report a profit of $2.89 per share, up 10.7% from $2.61 per share in the year-ago quarter. The company has surpassed Wall Street's bottom-line estimates in three of the past four quarters while missing on one other occasion. It reported an EPS of $2.78 in the last reported quarter, marginally missing the consensus estimate.
However, Wall Street expects Globe Life's EPS to rise 10.1% annually to $11.72 in fiscal 2024 from $10.65 in fiscal 2023. Looking ahead, in fiscal 2025, the company's EPS is projected to grow 9.6% annually to $12.84.
GL stock has plunged 25.6% over the past 52 weeks, underperforming the S&P 500 Index's ($SPX) 27.8% gains and the Financial Select Sector SPDR Fund’s (XLF) 24.2% returns over the same time frame.
Adding to the grim price performance, the insurance company’s share dipped a whopping 53.1% on Apr. 11 after Fuzzy Panda Research revealed a short position, alleging widespread insurance fraud, including policies issued for deceased and fictitious individuals. Globe Life countered, dismissing the report as driven by short-term profit motives, calling it misleading and based on anonymous allegations and recycled legal tactics. As a result, the stock rose 20.2% in the following trading session.
Moreover, GL stock rose 14.1% in the subsequent trading session after falling marginally on April 22 after the release of the Q1 earnings report. Despite missing the consensus EPS estimate, its bottom line improved 9.9% year over year, primarily driven by higher insurance underwriting income and excess investment income. It reported total premium revenues of $1.1 billion, up 4.6% year over year, primarily driven by higher premiums from Life and Health insurance.
Analysts' consensus view on Globe Life stock is cautiously optimistic overall, with a "Moderate Buy" rating. Among the nine analysts covering the stock, four recommend a "Strong Buy," one suggests a “Moderate Buy,” and the remaining four analysts advise a "Hold."
The average analyst price target for GL is $104.30, suggesting a potential upside of 25.5% from the current price levels.
On the date of publication, Kritika Sarmah 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.
