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Buy Or Sell MetLife Stock Before Earnings?

Published 07/30/2017, 04:50 AM
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MetLife (NYSE: NYSE:MET) is a $60 billion company today. Investors that bought shares one year ago are sitting on a 32.67% total return. That's above the S&P 500's return of 16.31%.

MetLife stock is beating the market, and it reports earnings next week. But does that make it a good buy today? To answer this question, we've turned to the Investment U Stock Grader. Our Research Team built this system to diagnose the financial health of a company.

Our system looks at six key metrics...

Earnings-per-Share (EPS) Growth: MetLife reported a recent EPS growth rate of -62.31%. That's below the insurance industry average of 51.68%. That's not a good sign. We like to see companies that have higher earnings growth.

Price-to-Earnings (P/E): The average price-to-earnings ratio of the insurance industry is 17.15. And MetLife's ratio comes in at 11.99. It's trading at a better value than many of its competitors.

Debt-to-Equity : The debt-to-equity ratio for MetLife stock is 35.24. That's below the insurance industry average of 53.65. The company is less leveraged.

Free Cash Flow per Share Growth : MetLife's FCF has been higher than that of its competitors over the last year. That's good for investors. In general, if a company is growing its FCF, it will be able to pay down debt, buy back stock, pay out more in dividends and/or invest money back into the business to help boost growth. It's one of our most important fundamental factors.

Profit Margins : The profit margin of MetLife comes in at 5.08% today. And generally, the higher, the better. We also like to see this margin above that of its competitors. MetLife's profit margin is below the insurance average of 9.2%. So that's a negative indicator for investors.

Return on Equity : Return on equity tells us how much profit a company produces with the money shareholders invest. The ROE for MetLife is -0.97%, and that's below its industry average ROE of 10.28%.

MetLife stock passes three of our six key metrics today. That's why our Investment U Stock Grader rates it as a Hold.

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