Citigroup Ups Earnings Estimates on MetLife

Citigroup (NYSE: C) upped its earnings estimates for 2009-2011 on insurance giant MetLife (NYSE: MET) while reiterating a "buy" rating on the shares with a $42 price target.

Calling current valuation "attractive" and noting the current price is a good entry point, Citigroup boosted its 2009 earnings estimate for MetLife to $2.85 a share from $2.75. The 2010 estimate was hiked to $4.10 from $4 and the 2011 was nudged higher to $4.70 a share from $4.60.

Citi noted MetLife has $10 billion in excess liquidity and that managment is attempting to rein in costs. Still, 2009 earnings will be down nearly 53% from 2007 levels and that decline is far greater than what is expected from most of MetLife's key rivals.

The research note said MetLife should focus more on profit growth than gaining market share, but also said that MetLife's investment portfolio appears strong and that it passed the Treasury Department's stress test with the lowest level of projected losses of any institution examined.

Bottom line: Citi says MetLife possesses the strongest long-term growth potential of any U.S. life insurer.