Analyst Note| Rajiv Bhatia, CFA |
MetLife finished the year with a decent quarter. Adjusted EPS (excluding notable items) was $1.53, a penny above the FactSet consensus estimate of $1.52. Adjusted earnings grew year over year across the board except for Latin America. Firmwide growth in earnings was driven by higher variable investment income, underwriting, and expense management. MetLife finished the year with a 12.0% expense ratio, an improvement from the 12.6% in 2019. Overall, we will maintain our no-moat rating but expect a modest increase to our fair value estimate of $42 due to time value of money and higher investment income. MetLife benefits from higher interest rates, and while rates are still low, long-term rates have increased since the beginning of the year.