MetLife to Redeem Notes Due 2033 - Analyst Blog

MetLife, Inc. MET announced the redemption of its outstanding notes with coupon rate of 5.875% due Nov 21, 2033. MetLife will redeem the notes on May 5, 2014.

On the date of redemption, the registered holders of the Notes will be paid a redemption price of 100% of the principal amount by MetLife. Additionally, the company will also pay the unpaid and accrued interest to the holders.

MetLife has sufficient cash balance, which supports the prepayments of the notes. As of 2013 end, the company had cash and cash equivalents of $7.59 billion. Moreover, the company enjoys significant cash flow from operations. During 2013, cash flow from operations grossed $16.1 billion.

MetLife focuses on shifting its product mix toward protection products along with disciplined underwriting, asset-liability and expense management as well as initiatives to increase fee revenue. These efforts should generate more predictable operating earnings and cash flows, thereby improving its risk profile and free cash flow.

MetLife has also been servicing its debt uninterruptedly. Long-term debt of the company reduced 1.7% from 2012-end to $18.83 billion as of 2013-end. The company aims to maintain a low risk-profile with improved financial leverage by reducing its debt level. The declining liability of the company is also reflected in the ratings affirmed for it. Moody's Corp. MCO asserted MetLife's senior debt at “A3” and also upgraded the outlook from negative to stable.

MetLife is set to announce its first-quarter 2014 earnings results on May 1, 2014.

Zacks Rank

MetLife presently carries a Zacks Rank #3 (Hold). Some top-ranked stocks in the multi line insurance industry that are worth mentioning include AXA Group (AXAHY) and FBL Financial Group Inc. FFG. Both these stocks carry a Zacks Rank #2 (Buy).