Attractive PE Ratio
Favorable Price to Sales Ratio
Strong Gross Profit Margin
Healthy Return on Equity
Low Debt to Equity Ratio
Strong Interest Coverage
📈 Strong Premium Growth
🌟 Favorable Underwriting Margins
🤝 Growing Agent Count
🚀 Growth Projections
💡 Innovation in Distribution
High EV to EBITDA Ratio
Moderate Net Profit Margin
Liquidity Ratios Indicate Concerns
⚠️ Increased Administrative Expenses
🔍 Regulatory Scrutiny
📉 Concerns Over Claim Costs
Overall, Globe Life demonstrates a healthy business model with strong growth metrics and operational efficiency. However, it faces challenges such as increasing administrative expenses and regulatory scrutiny. Future growth prospects appear promising, driven by premium revenue growth and innovative distribution strategies.
Analysis Date: February 6, 2025
Last Updated: March 12, 2025
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$489.71
Current Market Price: $116.24
IV/P Ratio: 4.21x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
76.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for GL
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (9.19)
P/B ratio ≤ 1.5 (1.85)
Current ratio ≥ 2.0
Long-term debt < Net current assets
Margin of safety (76.0%)
GL does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
The gross profit margin of 94.86% indicates the company retains a high percentage of revenue as profit after accounting for the cost of goods sold, highlighting strong operational efficiency.
The return on equity (ROE) of 21.19% signifies that the company is effective in generating profits from its equity, reflecting strong management performance.
The net profit margin of 18.53% is decent but may suggest room for improvement when compared to industry benchmarks.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
21.19%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-16)
Return on Assets (ROA)
Measures how efficiently a company uses its assets to generate profits
0.88%
Higher values indicate better asset utilization
TTM (as of 2025-04-16)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
94.86%
Higher values indicate better efficiency in production
TTM (as of 2025-04-16)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
18.53%
Higher values indicate better overall profitability
TTM (as of 2025-04-16)
The debt to equity ratio of 0.52 indicates a relatively low level of debt compared to equity, suggesting a conservative approach to leverage.
With an interest coverage ratio of 15.66, the company generates ample operating income to cover its interest expenses, indicating strong financial stability.
Current, quick, and cash ratios are all at 0.0, indicating potential liquidity issues and a lack of readily available cash to cover short-term obligations.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.52x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
GL: No data available
Globe Life reported a 4.7% increase in total premium income for 2024, demonstrating resilience in a high inflationary environment. Specific segments such as life insurance and health insurance showed growth rates of 4% and 7%, respectively, indicating a robust demand for their products.
The life underwriting margin reached 41%, with expectations to maintain a range of 40% to 42% for 2025. This reflects positive mortality trends and effective management of claims, showcasing the company's operational efficiency.
Increased productivity and growth in agent counts were reported, with American Income Life and Liberty National achieving agent count growth rates of 7% and 11%, respectively. This indicates a strong recruiting environment and potential for future sales growth.
Administrative expenses rose to $91 million due to IT and legal costs, which could impact overall profitability if not managed effectively. Continued vigilance is required to ensure expenses do not outpace revenue growth.
Globe Life anticipates continued premium revenue growth in both the life and health segments for 2025, with life premium revenue expected to grow by 4.5% to 5% and health premium revenue by 7.5% to 8.5%. This growth, driven by a recovering consumer base, positions the company well for the future.
The shift towards virtual sales and recruitment has expanded the agent pool and improved efficiency. This model aligns with changing consumer preferences and could lead to more sustainable growth in agent counts and sales.
Ongoing inquiries by the SEC and DOJ could pose risks if any negative findings arise. The management's ability to navigate these investigations will be crucial for maintaining investor confidence.
An increase in health claim costs due to higher utilization was noted, which could negatively impact the health underwriting margin and profitability if trends do not stabilize.