China Life Insurance (NYSE:LFC) and Metlife (NYSE:MET) are both large-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.
This table compares China Life Insurance and Metlife’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|China Life Insurance||4.91%||9.31%||0.99%|
China Life Insurance has a beta of 1.55, suggesting that its stock price is 55% more volatile than the S&P 500. Comparatively, Metlife has a beta of 1.11, suggesting that its stock price is 11% more volatile than the S&P 500.
China Life Insurance pays an annual dividend of $0.08 per share and has a dividend yield of 0.6%. Metlife pays an annual dividend of $1.76 per share and has a dividend yield of 3.7%. China Life Insurance pays out 28.6% of its earnings in the form of a dividend. Metlife pays out 32.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Metlife has increased its dividend for 6 consecutive years. Metlife is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation & Earnings
This table compares China Life Insurance and Metlife’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|China Life Insurance||$91.03 billion||0.77||$1.72 billion||$0.28||44.46|
|Metlife||$67.94 billion||0.66||$5.12 billion||$5.39||8.90|
Metlife has lower revenue, but higher earnings than China Life Insurance. Metlife is trading at a lower price-to-earnings ratio than China Life Insurance, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
0.3% of China Life Insurance shares are owned by institutional investors. Comparatively, 75.6% of Metlife shares are owned by institutional investors. 0.3% of Metlife shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
This is a summary of current ratings and price targets for China Life Insurance and Metlife, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|China Life Insurance||0||4||4||0||2.50|
Metlife has a consensus target price of $49.56, suggesting a potential upside of 3.32%. Given Metlife’s higher probable upside, analysts clearly believe Metlife is more favorable than China Life Insurance.
Metlife beats China Life Insurance on 10 of the 17 factors compared between the two stocks.
China Life Insurance Company Profile
China Life Insurance Company Limited, together with its subsidiaries, operates as a life insurance company in the People's Republic of China. It operates in four segments: Life Insurance Business, Health Insurance Business, Accident Insurance Business, and Other Businesses. The company offers individual and group life, annuity, accident, and health insurance products, as well as pension products. It is also involved in the asset management, annuity, retirement properties investment, fund management, financial service, health management, investment, investment management, and reinsurance businesses. China Life Insurance Company Limited sells its products through agents, direct sales representatives, and dedicated and non-dedicated agencies. The company was founded in 1949 and is headquartered in Beijing, the People's Republic of China. China Life Insurance Company Limited is a subsidiary of China Life Insurance (Group) Company Limited.
Metlife Company Profile
MetLife, Inc. engages in the insurance, annuities, employee benefits, and asset management businesses. It operates through five segments: U.S.; Asia; Latin America; Europe, the Middle East and Africa; and MetLife Holdings. The company offers life, dental, group short- and long-term disability, individual disability, accidental death and dismemberment, vision, and accident and health coverages, as well as prepaid legal plans; administrative services-only arrangements to employers; and stable value products, including general and separate account guaranteed interest contracts, and private floating rate funding agreements. It also provides pension risk transfers, institutional income annuities, tort settlements, and capital markets investment products; and other products and services, such as life insurance products and funding agreements for funding postretirement benefits, as well as company, bank, or trust-owned life insurance used to finance nonqualified benefit programs for executives. In addition, the company offers automobile, homeowners', and personal excess liability, as well as small business owners' property, liability, and business interruption insurance products. Further, it provides fixed annuities and pension products; medical and credit insurance products; variable, universal, term, endowment, and whole life insurance products; variable, and fixed and indexed-linked annuities; and protection against costs of long-term health care services. The company serves individuals, corporations and their employees, and other institutions and their members through independent agents, property and casualty specialists, sales forces, sales teams and relationship managers, and sponsoring organizations and affinity groups, as well as through career and independent agencies, bancassurance, direct marketing and e-commerce, brokers, and other third-party distribution channels. MetLife, Inc. was founded in 1863 and is headquartered in New York, New York.
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