Financial Review: MetLife (MET) & Prudential Financial (PRU)
MetLife (NYSE: MET) and Prudential Financial (NYSE:PRU) are both large-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, dividends, analyst recommendations, institutional ownership, valuation and profitability.
Institutional and Insider Ownership
74.2% of MetLife shares are owned by institutional investors. Comparatively, 64.5% of Prudential Financial shares are owned by institutional investors. 0.3% of MetLife shares are owned by company insiders. Comparatively, 0.7% of Prudential Financial shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
MetLife pays an annual dividend of $1.60 per share and has a dividend yield of 3.4%. Prudential Financial pays an annual dividend of $3.00 per share and has a dividend yield of 3.0%. MetLife pays out 1,778.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Prudential Financial pays out 33.6% of its earnings in the form of a dividend. MetLife has increased its dividend for 4 consecutive years and Prudential Financial has increased its dividend for 8 consecutive years.
Risk and Volatility
MetLife has a beta of 1.44, indicating that its share price is 44% more volatile than the S&P 500. Comparatively, Prudential Financial has a beta of 1.49, indicating that its share price is 49% more volatile than the S&P 500.
This table compares MetLife and Prudential Financial’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings and Valuation
This table compares MetLife and Prudential Financial’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|MetLife||$63.21 billion||0.79||$817.50 million||$0.09||520.17|
|Prudential Financial||$59.25 billion||0.71||$7.12 billion||$8.92||11.06|
Prudential Financial has higher revenue, but lower earnings than MetLife. Prudential Financial is trading at a lower price-to-earnings ratio than MetLife, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and price targets for MetLife and Prudential Financial, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
MetLife currently has a consensus target price of $58.89, indicating a potential upside of 25.81%. Prudential Financial has a consensus target price of $111.55, indicating a potential upside of 13.07%. Given MetLife’s stronger consensus rating and higher possible upside, research analysts clearly believe MetLife is more favorable than Prudential Financial.
Prudential Financial beats MetLife on 9 of the 17 factors compared between the two stocks.
MetLife, Inc. is a provider of life insurance, annuities, employee benefits and asset management. The Company’s segments include U.S.; Asia; Latin America; Europe, the Middle East and Africa (EMEA); MetLife Holdings, and Corporate & Other. Its U.S. segment is organized into Group Benefits, Retirement and Income Solutions and Property & Casualty businesses. Its Asia segment offers products, including life insurance; accident and health insurance, and retirement and savings products. Latin America offers products, including life insurance, and retirement and savings products. Life insurance includes universal, variable and term life products. EMEA offers products, including life insurance, accident and health insurance, retirement and savings products, and credit insurance.
About Prudential Financial
Prudential Financial, Inc., is a financial services company. The Company, through its subsidiaries, offers a range of financial products and services, which includes life insurance, annuities, retirement-related services, mutual funds and investment management. The Company’s operations consists of four divisions, which together encompass seven segments. The U.S. Retirement Solutions and Investment Management division consists of Individual Annuities, Retirement and Asset Management segments. The U.S. Individual Life and Group Insurance division consists of Individual Life and Group Insurance segments. The International Insurance division consists of International Insurance segment. The Closed Block division consists of Closed Block segment. The Company has operations in the United States, Asia, Europe and Latin America.
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