On Apr 9, the Zacks Investment Research downgraded
) to a Zacks Rank #5 (Strong Sell).
Why the Downgrade?
Citizens witnessed sharp downward estimate revisions after
reporting disappointing fourth-quarter and full-year 2012
results. Shares of this life insurer are likely to continue
fluctuating given the absence of any major growth catalyst in the
On Mar 11, Citizens reported nil operating earnings per share
for the fourth-quarter 2012, lower than both the Zacks Consensus
Estimate of 12 cents and 3 cents recorded in the year-ago
However, total revenue improved 1% year over year to $54.1
million, driven by 5.1% growth in premiums and 1.1% improvement
in net investment income. These were offset by higher benefits
and expenses as well as realized investment losses based on lower
yields. This also deteriorated the overall portfolio yield to
3.8% at 2012-end from 3.9% at 2011-end.
Citizens' financials witnessed lower operating net income for
all the four quarters of 2012. As a result, the company reported
weak fourth-quarter results with a negative earnings surprise of
100%. Citizens delivered negative earnings surprise in 3 out of 4
quarters of 2012 with an average beat of 47.9%.
The Zacks Consensus Estimate for 2013 decreased a penny to 40
cents per share over the last 30 days, with one estimate being
revised downward. For 2014, the Zacks Consensus Estimate sunk by
43% to 41 cents per share, over the last 30 days, with no
estimate revisions. No upward revisions have been witnessed for
both the years.
Meanwhile, the Most Accurate Estimate for Citizens' 2013
earnings stands at 9 cents a share, resulting in a negative
Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
) of -77.5%.
Other Stocks to Consider
However, not all insurers are performing as poorly as
Citizens. Some stocks that are outperforming in the insurance
CNO Financial Group Inc.
XL Group Plc
Everest Re Ltd.
). All of these carry a Zacks Rank #1 (Strong Buy).
CITIZENS INC A (CIA): Free Stock Analysis
CNO FINL GRP (CNO): Free Stock Analysis
EVEREST RE LTD (RE): Free Stock Analysis
XL GROUP PLC (XL): Free Stock Analysis Report
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