Aflac—Earnings Release Today

by hihih222

I expect good things for Aflac in their earnings release today. Finally over the hump of euro de-risking, Aflac should have ttm EPS of $6ish in my opinion, which will drop their P/E even more…. Since roughly 2010, EPS has been increasing steadily and P/E has been dropping steadily. At some point, we’ll hit P/E compression and I expect a nice jump for Aflac as the market decides to separate its views on Europe from its views on Aflac. This ycharts image is especially telling:

Image

Based on prior levels of 10-15 P/Es, if ttm EPS reaches $6ish we could see long term upside to $60-$80. Short term though if my earnings call is right I could see AFL reaching roughly $40…..but OK, this feels a bit awkward. I’m not explaining myself on why AFL will have such high EPS….

here are my blogs on AFL that I posted on the Motley Fool Blog Network a while back in case you want to see the thesis:

http://beta.fool.com/shamapant/2012/03/22/aflac-worth-over-80-share/2991/

http://beta.fool.com/shamapant/2012/04/30/i-was-right-aflacs-going-80/3938/

I guess we’ll see how I do in a few hours!

Shamapant

Disclosure: Long AFL

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