Primerica, Inc. (PRI): Dominance For One Financial Firm

Page 1 of 2

Primerica, Inc. (NYSE:PRI) distributes financial products (life insurance, mutual funds, debt elimination) to the underserved middle class in the U.S., Canada, Puerto Rico, and Spain. Yes, the company only has a market cap of $1.8 billion, but recently joined the Standard & Poor’s Mid Cap 400 index. Primerica has partnered with many companies from the time it was founded in 1977, but is its future as bright as its partners/competitors?

Primerica, Inc. (NYSE:PRI)Invesco is a very well-known financial firm that has partnered with Primerica, Inc. (NYSE:PRI) in the past few years. It was very difficult to drive down I-25 without seeing the name attached to the Denver Bronco’s stadium. With revenues increasing eight of the past ten years (down in 2008 and 2009), the company has generated more than $4 billion in the past TTM. With an industry average of 17, Invesco (NYSE:IVZ) currently shows a P/E of 16.8 and a forward P/E of 12.5.  The company has a market cap of approximately $11.8 billion and a Free Cash Flow (FCF) yield of 4.5%. With Earnings Per Share (EPS) rising just five of the past ten years, its earnings yield is 5.9%.

After 110 years, Legg Mason (NYSE:LM) is a pure global asset manager whose vision is to “be a proven leader in global asset management by delivering specialized investment solutions that meet our clients’ objectives and by rewarding our shareholders and employees.” There has been a long relationship between Legg Mason and Primerica. In 2012, Legg Mason generated approximately $2.6 billion in revenue, and they show a market cap of $3.63 billion. EPS have risen six out of the past ten years, but currently shows a .04% earnings yield. The company shows a forward P/E of 9.8 and a FCF yield of 13%.

I know people that work for MetLife (NYSE:MET) , but I am not sold on buying their stock. MetLife has a market cap of over $39 billion and EPS that have risen seven of the past ten years. MetLife has designed products exclusively for Primerica representatives that have been very successful. We have all seen the blimps with snoopy on them, but will popularity lead to success? The company shows a P/E of 14.8 (5 lower than the industry average), and a forward P/E of only 6.8%. After more than doubling revenues in the past decade, the company grossed $68 billion in the past year. MetLife shows a better earnings yield than any of the other companies at 6.8%. Let’s switch to a different type of financial company that deals primarily with insurance.

Prudential is arguably one of the most well-known insurance companies in the world. The company boasts a market cap of over $26 billion, and a P/E of 20.2. Prudential (NYSE:PRU) is not in partnership with America, but is one of its biggest competitors in the life insurance industry. The majority of Prudential’s life insurance is cash value, which is what Primerica makes money on by replacing it with the cheaper term insurance. The company does boast a dividend yield of 3.6%, compared to an industry average of 2.4%. Prudential shows a forward P/E of just 7.4 and an earnings yield of 5%. Eight of the past ten years Prudential has increased its EPS to $7.22. Prudential has been victim to a lot of scrutiny throughout its tenure, even having a book written exposing unethical practices called  Serpent on the Rock .

Primerica is the largest (number of representatives) independent financial services marketing organization in North America. The company has nearly 100,000 life insurance licensed representatives, and have managed to license over 50% of all mutual fund representatives nationwide in the past few years. Let’s look at some metrics of this company and let you decide if it’s worth your investment dollars.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

Top 6 Cities For The Ultra Rich to Live in Comfort

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!