3. Brighthouse Financial, Inc. (NASDAQ:BHF)
Greenlight Capital’s Equity Stake: $128.85 Million
Number of Hedge Fund Holders: 35
Brighthouse Financial, Inc. (NASDAQ:BHF) is a financial services company that provides annuity and life insurance products. It ranks among the top suppliers of life insurance offerings across the United States. With its wide-ranging and attractive range of life insurance offerings, the company is poised to gain from the increasing demand for individual insurance policies.
Additionally it remains one of the largest holdings in Greenlight Capital, as David Einhorn believes the insurer is dirt cheap considering its underlying fundamentals. The billionaire investor also believes the markets have undervalued this company because of complicated GAAP principles.
The insurance company continues to concentrate on boosting the sales of life insurance offerings and broadening its distribution channels to establish itself as a leading figure in the market. Brighthouse Financial, Inc. (NASDAQ:BHF) has concentrated on expanding its range of products with the introduction of Shield Level Pay Plus, which joins the collection of Shield Annuities.
The strong sales of Shield Level Annuities and increased fixed indexed annuities from the company’s newly introduced SecureKey product have contributed to Annuity sales growth.
Likewise, the company stands to gain from the expanding individual insurance market. The company is dedicated to increasing the sales of life insurance products, enhancing annuity offerings, and broadening its distribution channels to establish itself as a leading figure in the sector.
Brighthouse Financial, Inc. (NASDAQ:BHF) reported quarterly earnings of $5.57 per share, surpassing the forecast of $4.36 per share. This stands in contrast to profits of $4.13 per share in the previous year. The company’s total operating revenue rose by 2.6% annually, fueled by increased net investment income and other sources of income.
Over the last few quarters, there has been a noticeable upward trend in net investment income. Leveraging alternative investment income, asset growth, and higher interest rates, the insurer anticipates this metric will continue improving in the coming years. The stock trades at a discount with a price-to-earnings multiple of 2.
As of this year’s June quarter, 35 out of the 912 hedge funds profiled by Insider Monkey had invested in Brighthouse Financial, Inc. (NASDAQ:BHF). David Einhorn’s Greenlight Capital owns the most significant stake, which is worth $128.85 million.
Here is what Greenlight Capital stated the following regarding Brighthouse Financial, Inc. (NASDAQ:BHF) in its Q2 2024 investor letter:
“However, it wasn’t all roses. We had three material losers in the long portfolio (and an undisclosed loser in the short portfolio), and deservedly so. Brighthouse Financial, Inc. (NASDAQ:BHF) fell from $51.54 to $43.34. In successive quarters, BHF announced large, non-recurring and unexpected losses. This time, the company suffered a loss in a reinsurance arbitration that cost several hundred million dollars.”
