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【出版时间及名称】：2010年美国寿险行业前景展望
【作者】：瑞士信贷
【文件格式】：pdf
【页数】：44
【目录或简介】：
2010 Outlook: A Duck and a Rock
Uninspiring fundamentals/but group still cheap: Going into 2010, we retain
our moderately positive stance on the life insurance sector with an estimated
10-15% upside for the sector over the next 12 months. The most visible
catalysts from 2009 have largely played out. Although the fundamentals sound
uninspiring, we find ourselves struggling to find any good short ideas and we
can make a bull case for the majority of stocks we cover on a ‘valuation basis.’
Our Outperform stock picks are AFL, PRU, SFG, LNC and RGA. Our
Underperform rated stocks include AIG and TMK. We are Neutral on AMP,
CNO, DFG, GNW, HIG, MET, PFG, PL, PNX and UNM.
So why not aggressively buy the sector here? The main risk factors to worry
about for the sector are largely the ‘tail’ macro events such as a spike or
substantial decline in interest rates and weak equity markets. With that as our
backdrop, we see three main drivers impacting our ratings for the sector in
2010: 1. proactive capital management for select companies in 2h 2010, 2.
differences in EPS resiliency/visibility in a sustained low rate environment, and 3.
less structural ROE degradation than some other types of financials.
Capital Management/Build – a 2H 2010 Catalyst – With growing excess
capital positions, our analysis suggests UNM, PRU and somewhat surprisingly
PFG, will have among the best capital positions in the sector by y/e 2010. Our
analysis (see Exhibit 2) of both statutory capital, holding company liquidity and
flexibility and expected build through 2010 shows a wide range of capital
outcomes for the stocks. As a result of the capital analysis, we are raising our
target prices for PRU, RGA, UNM and PFG.
EPS Resiliency in a Low Rate Environment also a Key - We recommend
companies including AFL, PRU, SFG and RGA that we see having less interest
rate risk than peers. Part of the reason that both PRU and AFL have lower
interest rate risk than peers is due to their large Japanese footprints. We have
sized the earnings risk should reinvestment rates in 2010 be 5% for the sector.
We’ve concluded that 2010 earnings would be negatively impacted 2-7% on
average in that scenario (Exhibit 5).
Valuations cheap vs. history, but no longer appear discounted vs. banks
With most stocks trading between 7x and 9x 2010 EPS estimates and between
0.7x and 0.9x book value, the sector remains historically cheap. At 1.0x
tangible book, the sector’s valuation has converged with regional banks (just
1.1x tangible book) and large cap banks (1.4x tangible book) to a lesser extent.
Historically, life insurers have traded at 30-40% discounts vs. banks on reported
book (2x vs. 1.5x), and currently there is no valuation gap on reported book (life
insurers 0.9x BV is in line with banks), while the discount is just 10-30% vs.
tangible book value.
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