Keefe Bruyette analyst Ryan Krueger upgraded Globe Life to Outperform from Market Perform with a price target of $110, down from $130. The stock is down 40% over the past six weeks from a Department of Justice subpoena over agent sales practices and a short report alleging wider spread fraud, the analyst tells investors in a research note. The firm acknowledges ongoing risk from these accusations, but feels better following Globe Life’s response on the Q2 earnings call that included a willingness to accelerate and possibly increase buybacks. Keefe estimates the company’s run-off value at $80 per share in a distressed run-off scenario that it assigns a 35% weighting for valuation purposes. It sees “meaningful value” at current share levels despite the risks.
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