MCKINNEY, Texas - Globe Life Inc. (NYSE: NYSE:GL), an $8.8 billion market cap insurer with a 54-year track record of consistent dividend payments, today addressed accusations from a recent report by Viceroy Research, asserting the claims are unfounded. According to InvestingPro data, the company maintains strong profitability with a healthy 32.8% gross margin. The company emphasized its successful shift to a virtual business model for its subsidiary, American Income Life (AIL), which has expanded its agent workforce and increased policy issuance.
Globe Life highlighted the growth of AIL's agent numbers, which have risen from over 8,000 in March 2020 to more than 12,000 as of November 2024. This growth is attributed to the transition to a virtual business model, which has provided agents with work flexibility and reduced overhead costs, allowing them to more effectively build their businesses. The company's strategic shift appears to be paying off, with revenue growing 6.7% over the last twelve months. The company claims this model has positioned Globe Life as the leading issuer of life insurance policies in the United States, with over 17 million policies in force.
The statement from Globe Life specifically refutes the short seller's report, which suggested that AIL's presence is diminishing. Globe Life verified that the report's list of disconnected phone numbers, which implied business closures, is inaccurate and misleading. The company clarifies that its independent agency offices continue to operate and service customers nationwide from various virtual and physical locations.
Globe Life describes the allegations as a deliberate attempt by a short seller to damage the company's reputation, manipulate stock prices, and profit at the expense of its employees, investors, and the policyholders it serves. InvestingPro analysis suggests the company's fundamentals remain solid, trading at a P/E ratio of 8.9 with management actively buying back shares. For deeper insights into Globe Life's financial health and valuation metrics, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro.
This response from Globe Life comes as part of its ongoing effort to maintain transparency with its stakeholders and to defend its business practices and performance. The company's statement is based on a press release issued today.
In other recent news, Globe Life Inc. has been the subject of various developments. Viceroy Research raised concerns about the operational integrity of Globe Life's American Income Life Insurance (NS:LIFI) Company (AIL) division, citing office closures and disconnected phone lines. These findings could potentially impact the company's sales and overall business performance.
Globe Life also introduced an executive severance plan covering scenarios involving the termination of the company's Co-CEOs and other Named Executive Officers. The plan, detailed in a recent SEC 8-K filing, outlines severance benefits and conditions that require compliance with confidentiality, non-solicitation, intellectual property, and non-disparagement agreements.
The company has expanded its stock buyback program to $1.8 billion, highlighting its commitment to optimizing shareholder value. This move was backed by Co-Chief Executive Officer Matt Darden (NYSE:DRI), who emphasized the firm's consistent generation of free cash from its insurance operations.
In terms of earnings, Globe Life reported significant growth in its Q3 2024 financial results, with net income surging to $303 million, a 29% increase in net operating income to $308 million, and increases in both life and health insurance premium revenues. Following these results, Truist Securities revised its earnings per share estimates for 2024 and 2025, leading to a price target increase to $105.00.
Globe Life also temporarily suspended trading under its employee benefit plans due to a change in record keepers, affecting transactions in the company's Savings and Investment Plan. These are some of the recent developments surrounding Globe Life Inc.
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