This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Genworth: Obamacare Winner

NEW YORK ( TheStreet) -- Genworth (GNW - Get Report) was the winner among the largest players in the volatile U.S. insurance sector on Thursday with shares rising over 10% to close at $5.43.

The major news of the day was the Supreme Court's decision to uphold most of the provisions of the Patient Protection and Affordable Care Act -- signed into law by President Obama in 2010 -- including the individual mandate to carry maintain "minimum essential coverage" or face an IRS penalty, beginning in 2014.

The court struck down the provision of the Affordable Care Act that would have forced state governments to expand their Medicaid programs, or risk losing the federal aid they were already receiving for the program.

In other important financial news on Thursday, the New York Times reported that JPMorgan Chase (JPM - Get Report) may ultimately face hedge trading losses of as much as $9 billion, as the companyâ¿¿s Chief Investment Office works to wind down the trading positions that led CEO James Dimon on May 10 to announce estimated second-quarter hedge trading losses of $2 billion.

The KBW Bank Index (I:BKX) declined slightly to close at 44.59, recovering from an earlier dip of 2%, as JPMorgan recovered from an earlier 5% decline to close at $35.88, down 2% for the session.

The KBW Insurance Index rose 0.5% to close at 111.41, with 10 of the 24 index components showing increases.

Genworth -- saddled with a significant mortgage insurance business -- has seen its shares decline 17% year-to-date.

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

The shares trade for less than four times the consensus 2013 earnings estimate of $1.45 a share, among analysts polled by Thomson Reuters. The consensus 2012 EPS estimate is 79 cents.

In addition to its life insurance, wealth management and mortgage insurance products and services, Genworth provides long-term care insurance, covering "services provided in the insured's home or in assisted living or nursing facilities."

Bank of America Merrill Lynch analyst Edward A. Spehar has a neutral rating on Genworth, with a price objective of $8.00. The analyst said on Wednesday that his firm was sticking with its estimate that Genworth's mortgage insurance division "will earn $130 million in 2013, or half the level seen before the U.S. housing market collapsed," although "recent developments at Old Republic (ORI) suggest that there could be sustained pressure on the mortgage insurance market for longer than we have anticipated."

Genworth's long term care business contributed $132 million out of the company's total 2011 pretax operating income of $534 million.

Interested in more on Genworth? See TheStreet Ratings' report card for this stock.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
WLP $136.01 1.43%
GNW $7.94 0.00%
JPM $65.78 0.00%
AAPL $130.28 0.00%
FB $79.19 0.00%

Markets

DOW 18,010.68 -115.44 -0.64%
S&P 500 2,107.39 -13.40 -0.63%
NASDAQ 5,070.0260 -27.95 -0.55%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs