Industry Overview - The Zacks Accident and Health Insurance industry is expected to benefit from increased underwriting exposure, with companies like Aflac, Trupanion, and Globe Life likely to be driven by prudent underwriting standards [1] - The industry has maintained profitability due to solid reserves, prudent claims management, stable loss trends, and fewer claims, although a softer performance is predicted for 2025 [2] - The global workers' compensation insurance market is projected to grow significantly between 2024 and 2032, driven by rising awareness of the benefits of coverage [3] Trends Impacting the Industry - Pricing pressure is anticipated to continue due to inflation, rising medical costs, and demographic changes, with healthcare spending expected to increase by 5.4% annually through 2028 [4] - Claims frequency is improving due to better safety measures and working conditions, which is expected to enhance the industry's performance [5] - The adoption of technology, including AI and data analytics, is accelerating, potentially reducing workers' compensation claim expenses by about 45% [6] Industry Performance - The Zacks Accident and Health Insurance industry currently holds a Zacks Industry Rank of 227, placing it in the bottom 7% of 251 Zacks industries, indicating weak near-term prospects [7][8] - The industry has underperformed compared to the Finance sector and the Zacks S&P 500 composite, with a year-to-date gain of 4.5% compared to 12.2% and 10.1% respectively [11] Current Valuation - The industry is trading at a trailing 12-month price-to-book (P/B) ratio of 1.82X, significantly lower than the Zacks S&P 500 composite's 8.42X and the sector's 4.26X [14] Company Highlights - **Aflac**: Offers voluntary supplemental health and life insurance products, with a focus on strategic growth investments and digital solutions. The consensus estimate for 2025 earnings indicates a decrease of 5.3%, but an increase of 7% is expected for 2026 [19][20] - **Trupanion**: Provides pet insurance in a large but underpenetrated market, with a consensus estimate for 2025 earnings indicating a 252.2% increase. The company has a Growth Score of A and has seen significant upward revisions in earnings estimates [23][24] - **Globe Life**: Offers individual life and supplemental health insurance, with positive revenue trends driven by premium growth. The consensus estimates for 2025 and 2026 earnings indicate increases of 15.8% and 5.4% respectively [27][29]

Core Insights - Unum Group (UNM) shares have increased by 9.6% year to date, outperforming the Finance sector and the Zacks S&P 500 Composite, which grew by 8.4% and 5.9% respectively [1] - The company's market capitalization stands at $14.07 billion, with an average trading volume of 1.25 million shares over the last three months [1] Valuation Metrics - Unum Group's shares are trading at a forward price-to-book value of 1.25X, which is lower than the industry average of 1.83X, the Finance sector's 4.26X, and the Zacks S&P 500 Composite's 8.42X [3] - The company has a Value Score of A, indicating it is considered affordable compared to its peers [3] Growth Projections - The Zacks Consensus Estimate for Unum Group's 2025 revenues is $13.2 billion, reflecting a year-over-year increase of 2.8% [8] - Expected earnings per share for 2026 indicate a growth of 9.1%, while revenues are projected to increase by 3.5% from 2025 estimates [8] - Long-term earnings growth is anticipated at 7.2%, surpassing the industry average of 6% [8] Analyst Sentiment - The average price target for UNM shares is $94.43, suggesting a potential upside of 17.4% from the last closing price [9] - However, analysts have recently lowered their earnings estimates for 2025 and 2026 by 0.3% and 0.1% respectively over the past 60 days [12] Dividend Performance - Unum Group raised its dividend by 10% in May 2025, marking the 16th increase in 15 years, with a projected payout of $300–$330 million and a payout ratio of approximately 19.4% [12] - The dividend yield stands at 2.1%, slightly above the industry average, making it attractive for income-focused investors [12] Operational Performance - Premium income rose by 3.5% year over year to $2.7 billion in Q1 2025, driven by growth in core segments and the recapture of a previously ceded individual disability block [15] - The company projects sales growth of 5–10%, premium growth of 4%-7%, and a 6–10% increase in after-tax adjusted operating EPS for 2025 [15] - Unum U.S. and Colonial Life segments have shown consistent growth in operating income, with Colonial Life's adjusted operating income up 1.8% to $115.7 million in Q1 2025 [16] Financial Stability - Unum Group maintains a solid capital position, enhancing its financial flexibility and supporting prudent capital outlay [17] - The company has faced challenges such as rising expenses, declining premiums in the Closed Block segment, and muted growth in investment income due to past low-rate investments [18]

Core Insights - Globe Life Inc. (GL) shares are trading at a discount compared to the Zacks Accident and Health Insurance industry, with a forward price-to-earnings multiple of 8.22X, lower than the industry average of 12.27X, the Finance sector's 16.72X, and the Zacks S&P 500 Composite's 22.52X [1] - Globe Life has a market capitalization of $9.7 billion and an average trading volume of 0.6 million shares over the last three months [1] - The company has shown solid upward momentum, with shares closing at $117.60, above the 200-day simple moving average of $116.79 [3] - Globe Life's shares have surged 41.5% over the past year, outperforming the industry growth of 24.2%, the Finance sector's 18.8%, and the Zacks S&P 500 composite's 10.1% [4][7] - The Zacks Consensus Estimate projects a 9.8% year-over-year increase in earnings per share for 2025, with revenues expected to reach $6.04 billion, reflecting a 4.6% improvement [5] - The average target price for Globe Life shares is $145, suggesting a potential upside of 19.7% from the last closing price [9] Financial Performance - Globe Life's trailing 12-month return on equity is 21.4%, exceeding the industry average of 15.5% [11] - The return on invested capital (ROIC) for the trailing 12 months is 12.7%, better than the industry average of 7.6%, indicating effective fund utilization [12] - Earnings have grown by 13.3% over the past five years, outperforming the industry average of 5.5% [8] Growth Drivers - Globe Life is experiencing revenue growth driven by premium increases in its Life Insurance and Health Insurance segments, as well as net investment income [13] - The American Income and Liberty National divisions are expected to contribute significantly to future top-line growth, with net life and health sales projected to grow in the mid-teens for Liberty National [14] - The company maintains a strong liquidity position and has targeted a consolidated Company Action Level RBC ratio of 300% to 320% for 2025, supporting its financial strength [16] Shareholder Value - Globe Life has consistently increased its dividend over the past eight years, with a compound annual growth rate (CAGR) of 7% [17] - The company's strong capital position allows for enhanced shareholder value through share buybacks and dividend payouts [16] Conclusion - Globe Life's combination of higher life and health sales, improved invested assets, increased productivity, strong liquidity, and effective capital deployment makes it an attractive investment opportunity [18] - The company holds a favorable VGM Score of B, indicating strong value, growth, and momentum compared to peers [18] - Higher return on capital, favorable growth estimates, and attractive valuations are expected to benefit the insurer in the long term [19]

Core Insights - Unum Group (UNM) shares are trading at a discount compared to the Zacks Accident and Health Insurance industry, with a forward price-to-book value of 1.23X, lower than the industry average of 1.82X, the Finance sector's 4.16X, and the Zacks S&P 500 Composite's 8.1X [1] - The company has a market capitalization of $13.93 billion and an average trading volume of 1.4 million shares over the last three months [1] Performance Comparison - Unum Group shares have surged 63.5% in the past year, outperforming the industry growth of 27.1%, the Finance sector's 20.4%, and the Zacks S&P 500 composite's 10.8% [3] Technical Analysis - Shares closed at $79.25, near a 52-week high of $84.48, indicating strong investor confidence and potential for further price appreciation [5] - The stock is trading above the 50-day and 200-day simple moving averages of $78.88 and $72.31, respectively, suggesting solid upward momentum [5] Growth Projections - For 2025, Unum U.S. expects sales growth of 5-10% and an adjusted operating return on equity (ROE) of 23-25% [8] - The Zacks Consensus Estimate for Unum Group's 2025 revenues is $13.24 billion, reflecting a year-over-year improvement of 2.7% [10] - Long-term earnings growth is expected at 7.2%, outperforming the industry average of 6% [11] Analyst Sentiment - The average price target for UNM is $92.43 per share, suggesting a potential upside of 17.5% from the last closing price [12] - Recent analyst sentiment has shown some bearish trends, with three of eight analysts lowering estimates for 2025 and two for 2026 [16] Revenue and Premium Growth - Premiums are expected to grow due to healthy in-force block growth and higher sales, with projected sales growth of 5-10% and premium growth of 4-7% in 2025 [17][19] - Unum Group's operational excellence in its two largest segments, Unum U.S. and Colonial Life, is expected to drive growth [18] Dividend History - Unum Group has consistently increased shareholder value through dividend hikes, with a 15% increase effective in Q3 2024, marking the 15th hike in the last 14 years [20] - The dividend yield stands at 2.12%, making it attractive for yield-seeking investors [20] Conclusion - Favorable sales trends, strong persistency, and a solid capital position are expected to benefit Unum Group in the long term, making it a wise investment choice [21]