Earlier this week,
Hartford Financial Services Group Inc.
) completed the previously announced public offering of 4.3%
senior notes worth $300 million, due in 2043. The issue is a part
of the company's capital management plan.
The notes were assigned a "bbb+" debt rating by rating agency
A.M. Best Co., with a stable outlook. The rating agency also
revealed that Hartford Financial's financial leverage and
interest coverage ratios meet the criteria for the assigned
ratings following the recent debt repayment and this debt issue.
Moreover, A.M. Best did not alter any financial strength, issuer
credit and debt ratings of the company following the notes
Hartford Financial announced a capital management plan on Feb
4, 2013, aimed at boosting financial flexibility by reducing debt
and returning more value to shareholders through share
repurchase. The company plans to reduce its outstanding debt by
$1 billion, including repayment of debt worth $520 million, which
is due in 2013 and 2014.
Accordingly, Hartford Financial has already completed a cash
tender offer for repayment of senior notes worth $800 million at
a premium value of $1 billion. Further, the company plans to
repurchase shares worth $500 million by the end of 2013.
The debt repayment and new issue are aimed at improving the
financial leverage of Hartford Financial, along with reducing its
Hartford Financial presently carries a Zacks Rank #3 (Hold).
Other stocks in the insurance sector that are worth a look are
CNO Financial Group Inc.
) - Zacks Rank #1 (Strong Buy),
Eastern Insurance Holdings Inc.
) - Zacks Rank #2 (Buy) and
FBL Financial Group Inc.
) - Zacks Rank #2 (Buy).
CNO FINL GRP (CNO): Free Stock Analysis
EASTERN INSURNC (EIHI): Free Stock Analysis
FBL FINL GRP-A (FFG): Free Stock Analysis
HARTFORD FIN SV (HIG): Free Stock Analysis
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