Summary
- Aflac is trading at a premium compared to their 5-year average P/E ratio and the life insurance sector's average P/E ratio.
- Aflac is a Dividend Aristocrat and has a 5-year average dividend growth rate of 8%.
- Japan Post announced their plan to increase their investment in Aflac, which could eventually increase to 20% ownership in four years.
In today's dividend stock analysis, I wanted to take a look at a stock that I own and would like to increase my position in one day in the future. On top of it, the company is expected to announce a dividend increase in the coming weeks. We are the Dividend Diplomats for goodness sake. Dividend increases our one of our FAVORITE events to monitor. So today, we will review the recent news surrounding Aflac (NYSE:AFL), their recent investment from Japan Post, and run them through the Dividend Diplomats' Dividend Stock Screener to determine if AFL is considered an undervalued dividend growth stock. Unfortunately, based on our screener, it doesn't appear that AFL is considered undervalued. However, let's take a deeper look at the insurance giant.
AFL is one of the major players in the Accident and Health Insurance industry and the company possesses one of the iconic brand images. Who hasn't seen a commercial with the duck quacking Aflac? Aflac is a Fortune 500 company and has a major presence in both the United States and Japan. In fact, the majority of Aflac's operating earnings are earned from their Japan operating segment, not in the United States. Per the company's September 30, 2018 10-Q, the company's Japan operating segment earned $11,481 million for the 9 months during the year and the U.S. operating segment earned $4,831 million during the same period.
