Aflac (NYSE: AFL) and MetLife (NYSE:MET) are both large-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, risk, analyst recommendations, earnings, institutional ownership, valuation and dividends.

Dividends

Aflac pays an annual dividend of $1.72 per share and has a dividend yield of 2.1%. MetLife pays an annual dividend of $1.60 per share and has a dividend yield of 3.0%. Aflac pays out 25.9% of its earnings in the form of a dividend. 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. Aflac has increased its dividend for 4 consecutive years and MetLife has increased its dividend for 34 consecutive years. MetLife is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Aflac has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500. Comparatively, MetLife has a beta of 1.47, meaning that its share price is 47% more volatile than the S&P 500.

Institutional and Insider Ownership

65.6% of Aflac shares are owned by institutional investors. Comparatively, 74.3% of MetLife shares are owned by institutional investors. 3.0% of Aflac shares are owned by company insiders. Comparatively, 0.3% of MetLife shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Aflac and MetLife’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Aflac $22.65 billion 1.46 $4.75 billion $6.63 12.65
MetLife $63.21 billion 0.89 $817.50 million $0.09 587.29

Aflac has higher revenue, but lower earnings than MetLife. Aflac is trading at a lower price-to-earnings ratio than MetLife, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Aflac and MetLife’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aflac 11.98% 13.09% 2.05%
MetLife 0.30% 8.51% 0.65%

Analyst Recommendations

This is a summary of current ratings and price targets for Aflac and MetLife, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aflac 3 5 2 0 1.90
MetLife 1 6 7 0 2.43

Aflac currently has a consensus price target of $77.33, suggesting a potential downside of 7.80%. MetLife has a consensus price target of $58.24, suggesting a potential upside of 10.19%. Given MetLife’s stronger consensus rating and higher probable upside, analysts clearly believe MetLife is more favorable than Aflac.

Summary

Aflac beats MetLife on 9 of the 17 factors compared between the two stocks.

About Aflac

Aflac Incorporated is a business holding company. The Company is involved in supplemental health and life insurance, which is marketed and administered through its subsidiary, American Family Life Assurance Company of Columbus (Aflac). The Company’s insurance business consists of two segments: Aflac Japan and Aflac U.S. The Company designs the United States insurance products to provide supplemental coverage for people having medical or primary insurance coverage. Aflac U.S. offers accident coverage on both an individual and group basis. The Company offers cancer plans, critical illness plans, and critical care and recovery plans. The Company designs the United States insurance products to provide supplemental coverage for people having medical or primary insurance coverage. Aflac U.S. offers accident coverage on both an individual and group basis. The Company offers cancer plans, critical illness plans, and critical care and recovery plans.

About MetLife

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.

Receive News & Ratings for Aflac Incorporated Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Aflac Incorporated and related companies with MarketBeat.com's FREE daily email newsletter.