Deutsche Bank Starts AFLAC (AFL) at Hold

January 8, 2013 5:37 PM EST
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Price: $69.88 +0.34%

Rating Summary:
    5 Buy, 15 Hold, 3 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 35 | Down: 31 | New: 11
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Deutsche Bank initiates coverage on AFLAC (NYSE: AFL) with a Hold. PT $56.00.

The analyst comments, "In recent years, Aflac has reacted to market forces by partnering with banks in Japan to sell products with an asset accumulation perspective, and by working with U.S. brokers to sell group and other supplemental products. While the transitions to new distribution channels and new products have created opportunities to grow the top line, the investments and shifting business mix have resulted in margin compression.

With the derisking of the investment portfolio nearly complete, management has now turned its focus in Japan to improve yields on new money. This, along with pricing action taken on the WAYS product, should result in margin improvement starting in 2013."

The firm operating EPS forecast estimates for FY12E-FY14E are $6.55, $6.90 and $7.40, respectively - implying subdued EPS growth in spite of group-high ROEs

For an analyst ratings summary and ratings history on AFLAC click here. For more ratings news on AFLAC click here.

Shares of AFLAC closed at $51.84 yesterday.

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