Unbundled PRI Q2

While I’m waiting for my last two dividends to post so I can close out the quarter, I figured I’d update the results of the Primerica challenge.  Just to recap, about a year ago a Primerica rep provided some advice to me, the gist being even if I bought no products, I might want to buy the stock since it has performed ‘pretty well’.  So I did – but got to thinking – do the pieces that are sold via the reps perform better as a standalone investment rather than packaged with Primerica salesperson?  The last quarter said no, to my surprise.

Financials – which are a large part of what’s under Primerica’s hood – were laggards for most of the quarter.  The winds started to shift in February.  AIG is considering a spin of United Guaranty – in part to head off Carl Icahn.  Metlife sold a part of itself to MassMutual.  Then in March, Metlife won a court case against the US resulting in its’ SIFI designation being lifted.

Even with an increase in its dividend, the tailwinds were too strong for Primerica to overcome.  The stock price actually dropped and with dividends the total return was -5.34%.  And the unbundled group?  A positive 3.57%.

At the halfway point of this exercise, my expected outcome is in the lead.  Primerica, however, could get a boost from their upcoming rep meeting.  Also – and I consider this a net-neutral, Citi is offloading their Primerica reinsurance liabilities to SwissRe.  And so the game continues …