Insurance companies serve as the backbone of risk management, providing essential protection and financial security for individuals and businesses. But worries about an economic slowdown and potential claims deterioration have kept sentiment in check, and over the past six months, the industry’s 5.9% return has trailed the S&P 500 by 9.8 percentage points.
Despite the lackluster result, a few diamonds in the rough can produce earnings growth no matter what, and we started StockStory to help you find them. Keeping that in mind, here is one insurance stock poised to generate sustainable market-beating returns and two that may face trouble.
Two Insurance Stocks to Sell:
MetLife (MET)
Market Cap: $52.94 billion
Founded in 1863 by a group of New York businessmen during the Civil War era, MetLife (NYSE: MET) is a global financial services company that provides insurance, annuities, employee benefits, and asset management services to individuals and businesses worldwide.
Why Is MET Risky?
- 1.9% annual declines in net premiums earned for the past two years indicates policy sales struggled this cycle
- Earnings growth underperformed the sector average over the last two years as its EPS grew by just 13.6% annually
- Products and services are facing significant credit quality challenges during this cycle as book value per share has declined by 13% annually over the last five years
MetLife’s stock price of $80.08 implies a valuation ratio of 2.1x forward P/B. To fully understand why you should be careful with MET, check out our full research report (it’s free).
Assured Guaranty (AGO)
Market Cap: $3.90 billion
Serving as a financial safety net for over $11 trillion in debt service payments since its founding in 2003, Assured Guaranty (NYSE: AGO) provides credit protection products that guarantee scheduled payments on municipal bonds, infrastructure projects, and structured finance obligations.
Why Is AGO Not Exciting?
- Insurance policy sales contracted this cycle as net premiums earned decreased by 4.3% annually over the last five years
- Sales are projected to tank by 29.8% over the next 12 months as its demand continues evaporating
- Below-average return on equity indicates management struggled to find compelling investment opportunities
Assured Guaranty is trading at $81.93 per share, or 0.7x forward P/B. If you’re considering AGO for your portfolio, see our FREE research report to learn more.
One Insurance Stock to Watch:
Fidelis Insurance (FIHL)
Market Cap: $1.84 billion
Founded in Bermuda in 2014 and designed to adapt nimbly to evolving market conditions, Fidelis Insurance (NYSE: FIHL) is a global specialty insurer and reinsurer that provides customized coverage across property, specialty, and bespoke risk solutions.
Why Are We Positive On FIHL?
- Net premiums earned expanded by 20.6% annually over the last two years, demonstrating exceptional market penetration this cycle
- Forecasted revenue growth of 10.4% for the next 12 months indicates its momentum over the last two years is sustainable
- Projected book value per share growth of 20.7% for the next 12 months is above its two-year trend, pointing to accelerating profitability
At $17.50 per share, Fidelis Insurance trades at 0.8x forward P/B. Is now the right time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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