Earnings Preview: Aflac Incorporated (AFL)

Aflac Incorporated AFL is currently lower on the session by 0.47%, trading at $54.99. The company is scheduled to report earnings today, after the closing bell. • Estimates The Street is looking for Q3 earnings per share of $1.39 on revenue of $5.27 billion. These estimates have risen by $0.02 (+1.46%) over the past 90 days. The Whisper number for AFL is $1.43. • Guidance The Street is looking for Q4 EPS of $1.36 on revenue of $5.37 billion. The full year 2010 estimates are $5.52 per share on revenue of $20.80 billion; FY 2011 is at $6.11 per share on revenues of $21.70 billion. • Technical Picture AFL has been in rally mode for the past five months, jumping off of a low near $40.00 and rallying up toward prior resistance at $56.30. Shares are trading well above the 50-day and 200-day moving averages, at $52.50 and $48.50, respectively. • Volatility Both historical volatility and implied volatility have been falling for the past few months, following a spike higher in May. Currently HI is at 24% and IV is at 30%. The front month $55.00 straddle is trading at 30.52%; the December $55.00 straddle is trading at 29.80%. Vol is skewed toward the puts in both months. Aflac Incorporated is a general business holding company and acts as a management company, overseeing the operations of its subsidiaries. Its principal business is supplemental health and life insurance, through its subsidiary, American Family Life Assurance Company of Columbus, which operates in the United States and as a branch in Japan. Aflac's business consists of two segments: Aflac Japan and Aflac U.S. Aflac Japan sells supplemental insurance products, including cancer plans, general medical indemnity plans, medical/sickness riders, care plans, living benefit life plans, ordinary life insurance plans and annuities. Aflac U.S. sells supplemental insurance products, including accident/disability plans, cancer plans, short-term disability plans, hospital intensive care plans, fixed-benefit dental plans, vision care plans, care plans, and life insurance products. During 2009, the company acquired Continental American Insurance Group, Inc.