OLDWICK, N.J.--(BUSINESS WIRE)--
Following a 2.5% decline in the first quarter of 2014, life/annuity
(L/A) stocks rose 4.3% in the second quarter versus a 4.7% rise in the
S&P 500 stock index. 17 of the 24 stocks tracked for this analysis rose
in the quarter, eight of which increased 5% or more. The best performers
were Protective Life Corp., Symetra Financial Corp. and Principal
Financial Group, Inc., rising 31.8%, 14.7% and 9.8%, respectively. Kansas
City Life Insurance Co. and StanCorp Financial Group, Inc.
were the weakest stocks, falling 5.6% and 4.2%, respectively, according
to an A.M. Best special report.
Much of the quarterly gains for L/A stocks can be attributed to the
enthusiasm merger and acquisition (M&A) activity injected in the sector
following the USD 5.7 billion proposed acquisition of Protective Life by
Dai-ichi Life Insurance Co., Ltd. L/A stocks, which were roughly flat
before the announcement on June 3, 2014, rose 4.1% in less than a month
after the proposal was made public. In fact, 23 of the 24 companies A.M.
Best is tracking saw their share prices rise through quarter-end after
the announcement. An acquisition of this size and magnitude is
significant for the global L/A industry, as it confirms Japanese
insurers are looking at international opportunities to grow in the face
of a shrinking domestic population. Large-scale M&A deals of this type
typically pique investors’ interest in a sector.
To access a copy of this report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=227935.
A.M. Best Company is the world's oldest and most authoritative
insurance rating and information source. For more information, visit www.ambest.com.
Copyright © 2014 by A.M. Best Company, Inc.ALL RIGHTS
Nick Halen, (908) 439-2200, ext. 5126
Sharkey, (908) 439-2200, ext. 5159
Peavy, (908) 439-2200, ext. 5644
President, Public Relations
Source: A.M. Best