MetLife Inc Stock Buy Recommendation Reiterated (MET)

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

NEW YORK ( TheStreet) -- MetLife (NYSE: MET) has been reiterated by TheStreet Ratings as a buy with a ratings score of B- . The company's strengths can be seen in multiple areas, such as its reasonable valuation levels and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

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Highlights from the ratings report include:
  • The revenue fell significantly faster than the industry average of 21.6%. Since the same quarter one year prior, revenues fell by 19.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Despite currently having a low debt-to-equity ratio of 0.53, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further.
  • METLIFE INC has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, METLIFE INC increased its bottom line by earning $5.92 versus $3.15 in the prior year. For the next year, the market is expecting a contraction of 10.3% in earnings ($5.31 versus $5.92).
  • The share price of METLIFE INC has not done very well: it is down 6.55% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, although the push and pull of the overall market trend could certainly make a critical difference, we do not see any strong reason stemming from the company's fundamentals that would cause a continuation of last year's decline. In fact, the stock is now selling for less than others in its industry in relation to its current earnings.

MetLife, Inc., through its subsidiaries, provides insurance, annuities, and employee benefit programs in the United States, Japan, Latin America, the Asia Pacific, Europe, and the Middle East. MetLife has a market cap of $34.91 billion and is part of the financial sector and insurance industry. The company has a P/E ratio of 13.2, below the S&P 500 P/E ratio of 17.7. Shares are up 2.7% year to date as of the close of trading on Friday.

You can view the full MetLife Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

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