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Primerica (PRI)
NYSE:PRI
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Primerica
(NYSE:PRI)
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Rating:74Outperform
Price Target:
$303.00
â–²(10.03% Upside)
Primerica's overall stock score is driven by strong financial performance and attractive valuation. The company's profitability and operational efficiency are notable strengths, although recent declines in revenue and free cash flow growth present challenges. Technical indicators suggest stable momentum, while the earnings call highlights both growth opportunities and areas of concern. The absence of significant corporate events further solidifies the focus on financial and operational metrics.
Positive Factors
Investment and Savings Products Growth
The growth in investment and savings products indicates strong demand and effective sales strategies, contributing to long-term revenue stability and expansion.
Strong Mortgage Business Performance
The significant increase in mortgage business underscores Primerica's ability to capitalize on housing market trends, enhancing its revenue diversification and growth prospects.
Robust Recruiting and Sales Force Growth
Expanding the sales force strengthens Primerica's distribution network, supporting future sales growth and market penetration, which is crucial for sustaining long-term business expansion.
Negative Factors
Decline in Term Life Insurance Policies
A decline in new life insurance policies suggests potential challenges in maintaining market share and revenue from this core product line, impacting long-term growth.
Elevated Lapse Rates
High lapse rates in life insurance policies can reduce revenue stability and customer retention, posing risks to long-term profitability and market position.
Recruitment Decline Compared to Previous Year
A decrease in new representative recruitment may limit future sales growth and network expansion, affecting the company's ability to sustain its multi-level marketing model.
Primerica (PRI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$8.92B
Dividend Yield1.46%
Average Volume (3M)182.89K
Price to Earnings (P/E)13.6
Beta (1Y)0.83
Revenue Growth5.70%
EPS Growth61.69%
CountryUS
Employees2,289
SectorFinancial
Sector Strength70
IndustryInsurance - Life
Share Statistics
EPS (TTM)5.46
Shares Outstanding32,391,335
10 Day Avg. Volume231,208
30 Day Avg. Volume182,889
Financial Highlights & Ratios
PEG Ratio-1.40
Price to Book (P/B)4.10
Price to Sales (P/S)2.94
P/FCF Ratio11.13
Enterprise Value/Market Cap1.22
Enterprise Value/Revenue3.42
Enterprise Value/Gross Profit5.54
Enterprise Value/Ebitda8.17
Forecast
1Y Price Target
$307.50Price Target Upside11.66% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
Primerica Business Overview & Revenue Model
Company DescriptionPrimerica, Inc., together with its subsidiaries, provides financial products to middle-income households in the United States and Canada. The company operates in four segments: Term Life Insurance; Investment and Savings Products; Senior Health; and Corporate and Other Distributed Products. The Term Life Insurance segment underwrites individual term life insurance products. The Investment and Savings Products segment provides mutual funds and various retirement plans, managed investments, variable and fixed annuities, and fixed indexed annuities. The Senior Health segment offers segregated funds; and medicare advantage and supplement products. The Corporate and Other Distributed Products segment provides mortgage loans; prepaid legal services that assist subscribers with legal matters, such as drafting wills, living wills and powers of attorney, trial defense, and motor vehicle-related matters; ID theft defense services; auto and homeowners' insurance; home automation solutions; and insurance products, including supplemental health, accidental death, and disability for small businesses. It distributes and sells its products through a network of 129,515 licensed sales representatives. Primerica, Inc. was founded in 1927 and is headquartered in Duluth, Georgia.
How the Company Makes MoneyPrimerica generates revenue through multiple streams, primarily from the sale of financial products and services. The company's key revenue sources include life insurance premiums, investment product sales, and fees from financial planning services. Primerica earns commissions on the life insurance policies sold by its representatives, as well as on mutual funds and other investment products. Additionally, the company benefits from a robust multi-level marketing structure, where representatives earn commissions not only on their sales but also on the sales made by agents they recruit. This model incentivizes representatives to expand their networks, driving additional revenue. Strategic partnerships with financial institutions and investment firms also enhance Primerica's product offerings, further contributing to its earnings.
Primerica Earnings Call Summary
Earnings Call Date:Jun 30, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a strong financial performance with significant growth in investment and savings products, recruiting, and mortgage business. However, challenges were noted in the decline of term life insurance policies, elevated lapse rates, and a decrease in new representatives compared to the previous year. The overall sentiment is balanced with positive growth in some segments and challenges in others.Q2-2025 Updates
Positive Updates
Strong Financial Performance
Adjusted net operating income was $180 million, up 6% year-over-year, while diluted adjusted operating EPS increased 10% to $5.46.
Investment and Savings Products (ISP) Growth
ISP sales grew 15% to $3.5 billion, with net inflows at $487 million versus $227 million in the prior year. Client asset values were up 14% to $120 billion.
Robust Recruiting and Sales Force Growth
Over 80,000 recruits and nearly 13,000 new representatives were added, with life-licensed representatives increasing by 5% compared to June 2024.
Strong Mortgage Business Performance
U.S. mortgage closed loan volume increased by 33% year-over-year, and Canadian referral program closed loan volume increased by 30%.
Negative Updates
Decline in Term Life Insurance Policies
The number of new life insurance policies issued declined 11%, and the face amount issued declined 9% year-over-year.
Elevated Lapse Rates
Overall lapse rates remained elevated, driven by cost of living pressures, impacting the Term Life segment.
Recruitment Decline Compared to Previous Year
The number of newly licensed representatives was down 10% from the second quarter record set last year.
Methodology Correction for Canadian Mutual Funds
A need to correct the methodology for calculating outflows and market value for Canadian mutual fund assets was identified, though it did not impact financial statements.
Company Guidance
In the second quarter of 2025, Primerica reported strong financial results, with adjusted net operating income rising 6% year-over-year to $180 million and diluted adjusted operating EPS increasing by 10% to $5.46. The company returned $163 million to shareholders through $129 million in share repurchases and $34 million in dividends. Primerica recruited over 80,000 individuals and licensed nearly 13,000 new representatives, ending the quarter with 152,592 Life-licensed representatives, a 5% increase from June 2024. The company issued 89,850 new term life insurance policies, though this was an 11% decline year-over-year, with a total face amount in force reaching a record $968 billion. The Investment Savings Products (ISP) segment saw total sales grow 15% to $3.5 billion, with net inflows of $487 million, and client asset values increasing by 14% year-over-year to $120 billion. Mortgage business in the U.S. showed a 33% increase in closed loan volume, totaling $133 million. Despite the pressure on new life sales, Primerica remains optimistic about its long-term growth potential and continues to focus on expanding its sales force and returning capital to stockholders.Primerica Financial Statement Overview
Summary
Primerica demonstrates strong profitability and operational efficiency, with solid margins and return on equity. However, the recent decline in revenue and free cash flow growth, coupled with a moderate debt level, suggests potential challenges ahead.Income Statement
Primerica's income statement shows a robust EBIT and EBITDA margin, indicating strong operational efficiency. However, the recent revenue decline in the TTM period is a concern, suggesting potential market challenges. Despite this, the company maintains a healthy net profit margin, reflecting effective cost management.75
Positive
Balance Sheet
The balance sheet reveals a moderate debt-to-equity ratio, which is manageable but slightly elevated compared to previous years. The return on equity is strong, demonstrating effective use of shareholder funds. However, the equity ratio indicates a moderate reliance on debt financing, which could pose risks if market conditions worsen.70
Positive
Cash Flow
Cash flow analysis shows a decline in free cash flow growth, which could impact future investments and dividends. The operating cash flow to net income ratio is strong, indicating good cash generation relative to earnings. However, the recent negative free cash flow growth rate is a concern that needs monitoring.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.19B | 3.15B | 2.82B | 2.72B | 2.77B | 2.28B |
| Gross Profit | 1.97B | 1.31B | 2.48B | 1.53B | 2.77B | 2.28B |
| EBITDA | 1.34B | 987.68M | 2.60B | 681.39M | 703.98M | 553.27M |
| Net Income | 678.84M | 470.52M | 576.60M | 472.07M | 477.36M | 386.16M |
Balance Sheet | ||||||
| Total Assets | 14.83B | 14.58B | 15.03B | 15.35B | 16.12B | 14.91B |
| Cash, Cash Equivalents and Short-Term Investments | 3.72B | 1.68B | 1.62B | 3.05B | 3.18B | 3.01B |
| Total Debt | 1.91B | 1.95B | 2.04B | 2.08B | 2.04B | 1.77B |
| Total Liabilities | 12.52B | 12.32B | 12.96B | 13.63B | 14.03B | 13.07B |
| Stockholders Equity | 2.31B | 2.26B | 2.07B | 1.72B | 2.08B | 1.84B |
Cash Flow | ||||||
| Free Cash Flow | 809.07M | 832.86M | 658.62M | 731.86M | 632.27M | 615.79M |
| Operating Cash Flow | 837.95M | 862.09M | 692.52M | 757.66M | 656.96M | 643.42M |
| Investing Cash Flow | -276.21M | -232.25M | -90.05M | -200.05M | -923.38M | -53.53M |
| Financing Cash Flow | -568.35M | -551.14M | -479.62M | -457.85M | 107.97M | -301.79M |
Primerica Technical Analysis
Positive
275.39
Price Trends
266.04
Positive
266.48
Positive
271.47
Positive
Market Momentum
1.94
Negative
58.76
Neutral
55.15
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PRI, the sentiment is Positive. The current price of 275.39 is above the 20-day moving average (MA) of 270.81, above the 50-day MA of 266.04, and above the 200-day MA of 271.47, indicating a bullish trend. The MACD of 1.94 indicates Negative momentum. The RSI at 58.76 is Neutral, neither overbought nor oversold. The STOCH value of 55.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PRI.
Primerica Risk Analysis
Primerica disclosed 39 risk factors in its most recent earnings report. Primerica reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Primerica Peers Comparison
Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | 4.44B | 13.48 | 16.17% | 2.67% | 1.78% | 0.77% | |
77 Outperform | 11.78B | 11.62 | 19.66% | 0.70% | 4.02% | 13.01% | |
74 Outperform | $8.92B | 13.64 | 31.95% | 1.46% | 5.70% | 61.69% | |
73 Outperform | 12.98B | 9.12 | 13.42% | 2.26% | 1.69% | 22.65% | |
71 Outperform | 7.82B | 7.20 | 39.61% | 4.36% | 11.33% | -38.17% | |
63 Neutral | 7.02B | -1,584.75 | 0.00% | 3.08% | 27.18% | -100.02% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
Performance Comparison
PRI
Primerica
275.39
14.43
5.53%
LNC
Lincoln National
41.26
10.97
36.22%
GL
Globe Life
145.43
38.68
36.23%
UNM
Unum Group
76.21
19.31
33.94%
JXN
Jackson Financial Incorporation
100.79
13.33
15.24%
FG
F&G Annuities & Life Inc
32.99
-8.63
-20.74%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.