Primerica Inc. (NYSE:PRI) is one of the most undervalued quality stocks to buy right now. On January 28, TD Cowen increased its price target for Primerica to $326 from $322 while maintaining a Buy rating on the shares. This adjustment was made as part of the firm’s broader Q4 2025 preview of the life insurance group, in which TD Cowen maintains a balanced sector view despite anticipating a slight headwind from lower alternative returns. In Q3 2025, Primerica Inc. (NYSE:PRI) reported a 7% increase in adju ...

Middle-income Americans are continuing to feel financial strain and say their income is being outpaced by the rising cost of living, according to a new nonprobability-based analysis by Primerica. The financial services firm released the latest edition of the Primerica U.S. Middle-Income Financial Security Monitor quarterly survey on Thursday, which showed that 68% of middle-income Americans said their income is falling behind the cost of living – a figure that has remained steady in the last two years. T ...

Core Insights - Middle-income families are adjusting to a prolonged period of higher living costs, with 49% stating their main financial goal is to keep up with rising expenses [1] - The financial outlook for these families is stabilizing, but many still face significant financial stress and misconceptions about seeking financial guidance [1] Group 1: Financial Sentiment and Goals - 38% of middle-income Americans describe their relationship with financial stress as "it's complicated," indicating a disconnect between economic indicators and personal financial realities [1] - Nearly half (47%) of middle-income families prioritize paying down debt as a key financial goal for the year [1] - 69% of households reported delaying major purchases or expenses in 2025, with car purchases and home repairs being the most common delays [1] Group 2: Economic Outlook - 59% of middle-income Americans expect the U.S. economy to worsen in the next year, while only 24% anticipate improvement [1] - One-third (34%) of middle-income Americans expect to be financially worse off in the coming year, with similar sentiments remaining unchanged over the past six months [1] - The percentage of respondents who believe their income is falling behind the cost of living has increased slightly, with 68% reporting this sentiment [1] Group 3: Financial Guidance and Preparedness - 37% of households not working with a financial professional believe they do not have enough money to need one, while 35% think the cost of financial guidance is too high [1] - 62% of respondents reported having an emergency fund that could cover an expense of $1,000 or more, showing a slight increase over the past year [1] - A significant majority continue to feel it is difficult to save for the future, with 70% rating their ability to save as "not so good" or "poor" [1]

Group 1 - Primerica Life Insurance Company of Canada was named a finalist for two categories in an award event [1] - The winner of the awards was announced in November 2025 [1] - Primerica, Inc., the parent company of Primerica Financial Services (Canada) Ltd., received the Best Employer recognition [1]

Core Insights - Numerous companies are expected to increase their dividends in the upcoming quarterly earnings season, with many of these increases being minimal to satisfy shareholders, while larger increases are being sought after [2][3] Dividend Growth Companies - Companies with the potential for significant dividend increases, specifically those capable of raising distributions by at least 39%, are highlighted as attractive investment opportunities [3] - Lockheed Martin (LMT) serves as an example of a company that has consistently aligned its stock performance with its dividend growth, resulting in a yield on cost exceeding 18% for long-term holders [3][4] Primerica (PRI) - Projected dividend yield of 1.6% with a 39% increase expected in 2025, following a trend of doubling its payout over the past four years [5][6] - The company has shown steady revenue growth for over a decade, with earnings per share (EPS) expected to rise by low double digits in 2025, despite pressures from higher living costs [7] - Anticipation surrounds the upcoming dividend hike announcement in early February, with significant stock buyback programs also in place [8] Yum China Holdings (YUMC) - Projected dividend yield of 2.0% with a 50% increase expected in 2025, as the company continues to expand aggressively in the Chinese market [9][10] - Yum China plans to return $3 billion to shareholders between 2025 and 2026, with a notable increase in dividends from 10 cents per share in 2017 to 24 cents per share in 2025 [11][12] Comfort Systems (FIX) - Projected dividend yield of 0.2% with a 60% increase expected in 2025, reflecting a significant growth in dividends of approximately 471% since 2020 [13][15] - The company is well-positioned to benefit from growth in the technology sector, particularly in artificial intelligence, which drives demand for its services [14] Penske Automotive Group (PAG) - Projected dividend yield of 3.4% with a 40.2% increase expected in 2025, maintaining a history of quarterly dividend hikes for over a decade [16][19] - The company operates a diverse range of dealerships and has a significant presence in commercial vehicle retail, although net income has been declining recently [18][21] Howmet Aerospace (HWM) - Projected dividend yield of 0.2% with a 100% increase expected in 2025, following a substantial growth in dividends over the past five years [21][22] - The company is focused on advanced engineered products for aerospace and transportation, with a recent acquisition expected to drive revenue growth [23][24]

Core Viewpoint - Primerica (PRI) shares have underperformed over the past year, with a loss of approximately 5% in value, raising concerns about its exposure to middle-income consumers [1] Company Performance - Recent results from Primerica have been described as reasonable, yet market sentiment remains cautious due to the company's target demographic [1] Market Concerns - The primary concern for investors is the company's reliance on middle-income consumers, which may pose risks in the current economic climate [1]

Group 1 - Lockheed Martin Corporation is a key player in the defense sector, focusing on advanced technologies and military systems [1] - Penske Automotive Group Inc is expanding its automotive retail operations, indicating growth in the consumer market [1] - Comfort Systems USA Inc is experiencing increased demand for HVAC services, reflecting trends in the construction and energy efficiency sectors [1] Group 2 - Primerica Inc is showing strong performance in the financial services industry, particularly in life insurance and investment products [1]

Core Insights - Primerica, Inc. will host its largest senior leadership gathering in history on January 7-8, 2025, with over 1,000 top field leaders participating [1] Financial Performance - In 2025, Primerica issued nearly $112 billion in term life insurance, increasing total coverage in force to a record $968 billion [2] - The company paid over $1.8 billion in death claims, providing essential support to families [2] - Clients invested nearly $15 billion towards their future, pushing assets under management to a record $128 billion [2] - Families accessed more than $665 million in mortgages to manage debt or purchase homes [2] Distribution Expansion - Over 360,000 new representatives were recruited in 2025, resulting in over 48,500 new life-licensed representatives [2] - The company ended the year with over 2,400 newly securities-licensed representatives, bringing the total to over 25,600 [2] Company Overview - Primerica, Inc. is headquartered in Duluth, GA, and serves middle-income households in North America [4] - The company insured over 5.5 million lives and had approximately 3.0 million client investment accounts as of December 31, 2024 [4] - Primerica was the 3 issuer of term life insurance coverage in the U.S. and Canada in 2024 [4] - The company's stock is included in the S&P MidCap 400 and the Russell 1000 indices, traded under the symbol "PRI" [4]

Core Insights - The Primerica Household Budget Index (HBI) is estimated at 100.7% in November, reflecting a slight increase of 0.2% from the previous year [1] - The Consumer Price Index (CPI) recorded an inflation rate of 2.7% in November compared to the same month last year [1] Economic Metrics - The HBI measures the impact of inflation and wage trends on middle-income families' ability to afford everyday necessities [1] - The increase in the HBI indicates a slight improvement in the financial situation of middle-income families over the past year [1] - The CPI serves as a comprehensive measure of inflation for all U.S. households, indicating broader economic trends [1]

Core Viewpoint - Primerica demonstrates strong financial health with a sustainable dividend payout supported by conservative earnings and cash flow metrics [2][3][6]. Financial Metrics - Primerica pays an annual dividend of $4.16 per share, yielding 1.65% [2]. - The earnings payout ratio stands at 19.1%, indicating a very healthy dividend coverage [4][6]. - Operating cash flow coverage for Q3 2025 is 6.0 times, showcasing outstanding cash flow management [4][6]. Cash Flow and Capital Expenditures - In Q3 2025, Primerica generated $202.9 million in operating cash flow while spending only $12.3 million on capital expenditures, resulting in $190.6 million in free cash flow [3]. - Quarterly dividend payments amounted to $33.8 million, further emphasizing strong cash flow coverage [3]. Balance Sheet Strength - As of Q3 2025, Primerica holds $645 million in cash with a debt-to-equity ratio of 0.80, indicating a solid balance sheet [5]. - The insurance subsidiary maintains a risk-based capital ratio of 515%, significantly above the regulatory minimum of 200% [5]. Recent Performance - Q3 2025 revenue increased by 8.1% year-over-year to $839.8 million, while earnings surged by 31.4% to $206.8 million [6][8]. - Management returned $163 million to shareholders in Q3 through $129 million in buybacks and $34 million in dividends [6]. Capital Efficiency - Primerica's return on equity is 34.0%, and the operating margin is 34.2%, reflecting efficient capital deployment [7]. - The profit margin stands at 21.6%, indicating effective conversion of revenue to cash [7].