3 Stocks Pushing The Insurance Industry Lower

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

The Insurance industry as a whole closed the day down 0.2% versus the S&P 500, which was down 0.7%. Laggards within the Insurance industry included Life Partners Holdings ( LPHI), down 2.2%, Crawford & Company ( CRD.A), down 2.4%, Crawford & Company ( CRD.B), down 2.6%, Citizens ( CIA), down 1.6% and Fidelity and Guaranty Life ( FGL), down 1.9%.

TheStreet Ratings Group would like to highlight 3 stocks that pushed the industry lower today:

Fidelity and Guaranty Life ( FGL) is one of the companies that pushed the Insurance industry lower today. Fidelity and Guaranty Life was down $0.48 (1.9%) to $24.45 on light volume. Throughout the day, 40,701 shares of Fidelity and Guaranty Life exchanged hands as compared to its average daily volume of 72,600 shares. The stock ranged in price between $24.27-$25.25 after having opened the day at $25.08 as compared to the previous trading day's close of $24.93.

Fidelity and Guaranty Life has a market cap of $1.5 billion and is part of the financial sector. Shares are up 31.6% year-to-date as of the close of trading on Tuesday. Currently there is 1 analyst who rates Fidelity and Guaranty Life a buy, no analysts rate it a sell, and 2 rate it a hold.

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At the close, Citizens ( CIA) was down $0.12 (1.6%) to $7.62 on light volume. Throughout the day, 22,588 shares of Citizens exchanged hands as compared to its average daily volume of 101,200 shares. The stock ranged in price between $7.54-$7.87 after having opened the day at $7.80 as compared to the previous trading day's close of $7.74.

Citizens, Inc., through its subsidiaries, provides life insurance products in the United States and internationally. It primarily offers whole life insurance, endowments, credit insurance, final expense, and limited liability property policies. Citizens has a market cap of $387.7 million and is part of the financial sector. Shares are down 11.5% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates Citizens as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from TheStreet Ratings analysis on CIA go as follows:

  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Insurance industry average. The net income increased by 27.4% when compared to the same quarter one year prior, rising from $1.82 million to $2.32 million.
  • CIA's revenue growth trails the industry average of 21.5%. Since the same quarter one year prior, revenues slightly increased by 6.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • CIA has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign.
  • CITIZENS INC has improved earnings per share by 25.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. During the past fiscal year, CITIZENS INC increased its bottom line by earning $0.11 versus $0.09 in the prior year.
  • Net operating cash flow has slightly increased to $23.43 million or 9.93% when compared to the same quarter last year. Despite an increase in cash flow, CITIZENS INC's cash flow growth rate is still lower than the industry average growth rate of 33.95%.

You can view the full analysis from the report here: Citizens Ratings Report

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Life Partners Holdings ( LPHI) was another company that pushed the Insurance industry lower today. Life Partners Holdings was down $0.02 (2.2%) to $0.69 on light volume. Throughout the day, 28,593 shares of Life Partners Holdings exchanged hands as compared to its average daily volume of 51,400 shares. The stock ranged in price between $0.69-$0.72 after having opened the day at $0.70 as compared to the previous trading day's close of $0.71.

Life Partners Holdings, Inc., through its subsidiary, Life Partners, Inc., operates in the secondary market for life insurance worldwide. It facilitates the sale of life settlements between sellers and purchasers, but does not take possession or control of the policies. Life Partners Holdings has a market cap of $13.2 million and is part of the financial sector. Shares are down 60.4% year-to-date as of the close of trading on Tuesday.

TheStreet Ratings rates Life Partners Holdings as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity and generally disappointing historical performance in the stock itself.

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Highlights from TheStreet Ratings analysis on LPHI go as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Diversified Financial Services industry. The net income has significantly decreased by 302.1% when compared to the same quarter one year ago, falling from -$1.79 million to -$7.21 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Diversified Financial Services industry and the overall market, LIFE PARTNERS HOLDINGS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 60.23%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 290.00% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • LIFE PARTNERS HOLDINGS INC has experienced 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 not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, LIFE PARTNERS HOLDINGS INC continued to lose money by earning -$0.13 versus -$0.16 in the prior year.
  • Net operating cash flow has increased to -$1.63 million or 27.77% when compared to the same quarter last year. Despite an increase in cash flow, LIFE PARTNERS HOLDINGS INC's cash flow growth rate is still lower than the industry average growth rate of 57.47%.

You can view the full analysis from the report here: Life Partners Holdings Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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