China Life’s recent upbeat results (LFC) show that its restructuring moves are fruitful in 2018 and that the company is on track for a successful turnaround. LFC’s share price has dropped 28% since early 2018, when it launched its restructuring journey. However, the share price of life insurance subsidiary Ping An Insurance Group (OTCPK: PNGAY) – Ping An Life – rose 27 percent over the same period. Regression research by Chinese and regional counterparts showed that the LFC is currently underestimated (based on P/BV), with a potential increase of only 15% due to multiple expansion. Refining its product mix and distribution, LFC has always sought to increase its margin and profitability.
In the first half of 2020, LFC’s VNB even surpassed that of Ping An Life, both in size and growth. However, since the end of 2019, its share price has still dropped 18 percent, compared with Ping An’s 12 percent growth over the same period. LFC life insurance (LFC) in China is undervalued due to the lack of affixed pairs. The Chinese life insurance company most equivalent to LFC is Ping An Life, which is not listed. It may be too early to declare that LFC’s restructuring approach works, because 2021 is a unique year and the results are difficult to fully consider.
Since the end of 2018, however, its book value has increased by about 20% as this reflects a 15% increase only due to its repeated growth. The life insurance industry is not easy to understand and it is certainly not “sexy”. Current investors’ preference is largely growth-oriented over value stocks. With tech company valuations reaching historic levels, investors could once again start looking for cheap investment possibilities in conventional insurance and financial services this year.
Bank of China Life Insurance Company Limited – LFC
China Life InsuranceChina Life Insurance (NYSE: LFC) is one of the leading life insurance companies in China. In an area they used to dominate, the LFC lost their advantage. McKinsey believes that asset management and debt management will be the method to distinguish insurers’ long-term performance. Wang notes that the LFC insurance business has lost its competitiveness, in particular compared to Ping An Group. Wang In 2020, LFC recorded gross premium income of CNY 568.4 billion, which accounted for 19.2% of the market and ranked first.
The company’s leading position is undoubtedly at risk, Wang adds, but it still has some advantages. The low interest rate environment will increase the sustainability of these companies. LFC has been losing its market leadership position and seeks change under the motto ‘revitalization’. The organization will break away from the old methods of operating insurance and pursue new business management strategies, with a greater emphasis on the quality of services and goods, rather than pure quantity. Since its launch in early 2019, LFC’s plan has achieved excellent results, with healthy finances that will allow it to return to leading the industry.
LFC Stock Analysis: What You Should Know
If you are considering investing in shares of China Life Insurance Company Limited (LFC), there are a few things to consider. The company has been profitable for the past 11 years. One of the main concerns investors may have is that LFC’s net interest margin is low compared to other international insurers. This means they make less money on their loans because they are not charging as much interest. LFC’s aim is to provide quality financial protection for clients and their families.
The company has been profitable for the past 11 years. According to its website, the company’s mission is to provide high-quality financial protection to customers and their families and to care for the environment. The company’s shareholders are still willing to invest in the company, although the share price has fallen more than 5% year to date. Dividend China Life Insurance Company Limited has a dividend yield of 5.68%. That’s slightly higher than the S&P 500 average. The stock is pretty close to its 52-week low. That means it’s a good time to invest in stocks, but you’ll need to take a position on the LFC soon if you want to keep it for several years.
In recent years, LFC has been building its branch network. Since 2000, the company has invested nearly $2 billion in improving its infrastructure. LFC also plans to expand into other areas such as digital and mobile banking and insurance. Investors also saw a change in LFC’s sales structure. Previously, the company placed multiple sales representatives in one store to gain more customers. This is no longer the case. Sales representatives in each market now have more freedom to sell their products. Trading Analysis LFC has seen some very positive trends in recent years. The company has been increasing its revenue every year since 2008. This is a sign that it is still one of the best insurers in China.
Although growth prospects are favourable, the company’s future performance is not so good. One problem the company faces is China’s low interest rate environment. This means that the amount they can charge for their products may not increase as quickly as in the past. Chinese equities are not known for their long-term investment potential, especially if they are in a low-interest environment like the one they are in today. While the company isn’t hugely overvalued, investors shouldn’t expect long-term gains on their investments. It’s always a good idea to do your own due diligence and consider other factors that could affect the future performance of a stock, such as competition and the company’s economic conditions.
China Life Insurance Company Limited (LFC) is an extremely low-cost insurer, with a current P/E ratio of 8.36, which is significantly lower than the S&P 500 average of 20.5. LFC has a very attractive dividend yield of 5.1%, which is one of the highest among Asia-Pacific countries. The company has one of the lowest share prices relative to book value among all foreign insurers. In addition, the LFC is reasonably stable and currently has a P/E ratio of around 10 and a dividend yield of 5.1%. However, some of the risk factors I highlighted are all consistent with the insurance industry. Still, LFC has a profitable track record with a very low P/E ratio, excellent dividend yield and a low P/B.
