Torchmark (TMK) Reaches New Lifetime High Today

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.

Trade-Ideas LLC identified Torchmark ( TMK) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Torchmark as such a stock due to the following factors:

  • TMK has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $32.2 million.
  • TMK has traded 8,921 shares today.
  • TMK is trading at a new lifetime high.

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More details on TMK:

Torchmark Corporation, through its subsidiaries, provides various life and health insurance products, and annuities in the United States, Canada, and New Zealand. It operates through Life Insurance, Health Insurance, Medicare Part D, and Annuities segments. The stock currently has a dividend yield of 0.9%. TMK has a PE ratio of 14. Currently there are no analysts that rate Torchmark a buy, 3 analysts rate it a sell, and 10 rate it a hold.

The average volume for Torchmark has been 649,700 shares per day over the past 30 days. Torchmark has a market cap of $7.2 billion and is part of the financial sector and insurance industry. The stock has a beta of 1.19 and a short float of 4.3% with 9.01 days to cover. Shares are up 6.2% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Torchmark as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, increase in stock price during the past year, good cash flow from operations and attractive valuation levels. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Although TMK's debt-to-equity ratio of 0.26 is very low, it is currently higher than that of the industry average.
  • TORCHMARK CORP' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, TORCHMARK CORP increased its bottom line by earning $4.10 versus $3.80 in the prior year. This year, the market expects an improvement in earnings ($4.30 versus $4.10).
  • After a year of stock price fluctuations, the net result is that TMK's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • Net operating cash flow has slightly increased to $279.73 million or 1.77% when compared to the same quarter last year. Despite an increase in cash flow, TORCHMARK CORP's cash flow growth rate is still lower than the industry average growth rate of 21.44%.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 9.4%. Since the same quarter one year prior, revenues slightly dropped by 0.2%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

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