“Considering that MetLife and the whole insurance industry is highly dependent on the level of interest rates, it hasn't been a surprise that MetLife is facing shrinking profits as well as declining cash flow and total income over the last few years,” says Stephan Unger, assistant professor of economics at Saint Anselm College in New Hampshire.
Economics Professor Quoted in "U.S. News"
May 29, 2019
Assistant Professor Stephan Unger is quoted in "U.S. News" discussing the state of MetLife Inc. and the profitability of investing. (The article follows in part.)
Pros and Cons to Buying MetLife Stock
MetLife Inc (NYSE: MET) has been on a downward slide so far in 2018, with massive insurance losses due to massive rainstorms and flooding across the U.S. and Canada.
The company's stock price has fallen from $54 to about $45, and is down nearly 10 percent so far this year. But analysts haven’t given up on MET – the consensus estimate among analysts who follow the insurance giant call for a one-year estimate share price of $53.
When will the New York-based insurer turn around its fortunes? The broader signs signal a green light, but money managers and analysts do see some speed bumps ahead.
Professor Stephan Unger's Comments
“But due to decreasing liabilities, the company has been able to operate on a very profitable basis, as indicated by its financial ratios such as operating margin,” Unger says. "Given the current upward trend in interest rates, it is likely that operating margins for insurance companies will improve and boost profit and income going forward.”