Shares of MetLife surged Thursday, a day after the insurer reported quarterly earnings that beat analysts’ expectations.
THE SPARK: MetLife Inc. on Wednesday said it earned $471 million, or 43 cents per share, for the three months ending June 20, up from $2.26 billion, or $2.12 per share, a year earlier. Revenue rose 2 percent to $17.04 billion.
If not for a big loss on derivatives, MetLife would have earned $1.59 billion, or $1.44 per share. On that basis, analysts had expected a profit of $1.33 per share.
In a call with analysts Thursday, John Hele, MetLife’s chief financial officer, said that the company now expects to top its previous full-year earnings guidance of $4.95 to $5.35 per share, according to a transcript of the call.
THE ANALYSIS: In a note out Thursday, John Nadel, an equity analyst at Sterne Agee & Leach, pointed to encouraging signs in the insurer’s results: Expenses dropped from the previous quarter, and rising stock markets helped boost results.
Nadel, who has a “Buy” rating on MetLife, raised his forecast for full-year earnings to $5.67 per share from $5.52, and also nudged up his forecasts for 2014 and 2015. Nadel also lifted his price target on the company’s stock by $1, to $57.
SHARE ACTION: MetLife’s stock gained $3.09, or 6.4 percent, to $51.51 in afternoon trading, after rising as high as $51.61 earlier in the session — its highest level in five years.