Aflac vs Globe Life Which Is a Better Investment?

Aflac Incorporated and Globe Life Inc. are two prominent players in the insurance industry, specifically known for their supplemental health and life insurance products. Aflac's stock has seen steady growth over the years due to its strong brand recognition and innovative marketing strategies, while Globe Life's stock performance has been characterized by a more conservative approach and focus on steady dividend payments. Both companies have loyal customer bases and are well-positioned to weather economic challenges in their respective markets.

Aflac or Globe Life?

When comparing Aflac and Globe Life, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Aflac and Globe Life.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Aflac has a dividend yield of 1.92%, while Globe Life has a dividend yield of 0.69%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Aflac reports a 5-year dividend growth of 5.26% year and a payout ratio of 27.72%. On the other hand, Globe Life reports a 5-year dividend growth of 6.97% year and a payout ratio of 7.93%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Aflac P/E ratio at 15.29 and Globe Life's P/E ratio at 8.42. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Aflac P/B ratio is 2.35 while Globe Life's P/B ratio is 1.98.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Aflac has seen a 5-year revenue growth of 0.11%, while Globe Life's is 0.50%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Aflac's ROE at 15.81% and Globe Life's ROE at 22.49%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $104.32 for Aflac and $104.24 for Globe Life. Over the past year, Aflac's prices ranged from $75.08 to $115.50, with a yearly change of 53.84%. Globe Life's prices fluctuated between $38.95 and $132.00, with a yearly change of 238.90%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.