Prudential Financial Inc (NYSE:PRU) — This large-cap financial services company provides insurance, investment management and other financial products to clients in the U.S. as well as globally.
Various ongoing international expansion programs should add long-term revenues, such as PRU’s new expansion in Japan. Their varied product offerings, geographic diversification and well-known and accepted brand name all contribute to high public recognition.
In 2016, Standard & Poor’s estimates that earnings will at about $8.66, down from $12.17 in 2015. However the 2015 result was unusually strong vs. $3.20 in 2014. Their operating earnings estimate for 2017 is $10.15 per share, thus S&P estimates that the stock is undervalued vs. peers and its 10-year average of 9.7X earnings.
S&P’s 12-month target is $82, which would assume it trades at just 8.1X 2017’s estimated EPS. PRU pays an annual dividend of $2.80, providing a yield of 3.5%.
When the stock market sustains a sharp loss, such as Friday’s, when just 173 stocks advanced and 2,953 declined, it is always a good idea to highlight those that resisted the selling and instead advanced.
PRU stock closed higher against a harsh environment and rose 49 cents on much-higher-than-average volume. On August 25, PRU buyers emerged to break through the bearish resistance line at about $77, and that breakout was quickly followed by a CBR Super Buy from my own internal indicator.
Last Tuesday the 50-day moving average crossed through the 200-day moving average, signaling a “Golden Cross” long-term trend change and buy signal.
Technically PRU is in a new bull market, and so try to buy it at $78 with a trading target of $90 for an objective of 15%-plus.
Investors may also consider this quality financial services company as a long-term income producer and growth investment.