Updated 4/13/25
Aflac might be best known for its quirky duck commercials, but behind the scenes, it’s a disciplined insurance company with a strong foundation and a long history of rewarding its shareholders. Headquartered in Columbus, Georgia, Aflac specializes in supplemental insurance—covering things like accidents, illnesses, and other medical events that aren’t fully handled by traditional policies. It’s a business model that’s served the company well for decades, especially in its two main markets: the United States and Japan.
Founded in 1955, Aflac has quietly built itself into a $58 billion enterprise. It’s not the kind of name that grabs headlines every week, but for investors who care about income and long-term growth, that’s part of the charm. Aflac has consistently delivered on earnings, maintained a conservative balance sheet, and increased its dividend year after year—without ever making a lot of noise about it.
Recent Events
Aflac has been making some notable moves under the radar. The company’s most recent financials were eye-catching. Earnings grew by more than 600% year-over-year, driven in part by strong investment income and continued momentum in the Japanese market. At the same time, revenue saw a 43% boost from the previous year, climbing to nearly $19 billion. Not bad for a company many still think of as a sleepy insurer.
The company’s return on equity now stands at 22.6%, and its profit margins remain healthy. With operating margins over 40%, Aflac continues to demonstrate it can generate solid returns without taking excessive risk. And while the stock market has seen its share of ups and downs, Aflac has quietly outperformed the broader S&P 500 over the last 12 months, with the stock gaining more than 33%.
Another thing to keep in mind is Aflac’s low volatility. The stock carries a beta of just 0.80, which means it typically moves less than the market overall. That can be a real advantage for dividend investors who want steady income without wild price swings.
Key Dividend Metrics
🐣 Forward Dividend Yield: 2.17%
💵 Annual Dividend: $2.32 per share
📈 5-Year Average Yield: 2.32%
🛡 Payout Ratio: 20.77%
📆 Most Recent Dividend Date: March 3, 2025
🚫 Ex-Dividend Date: February 19, 2025
📊 Dividend Growth Streak: 40+ years
🔁 Last Stock Split: 2-for-1 on March 19, 2018
Dividend Overview
While Aflac’s 2.17% forward yield may not be the highest on the market, it’s the consistency and quality of that dividend that stand out. With a payout ratio sitting just below 21%, the company has plenty of breathing room to keep growing the dividend without stretching its finances.
This isn’t a firm that tries to impress with high short-term yields. Instead, it focuses on maintaining a safe, growing payout. Over time, that strategy tends to benefit long-term investors far more than a flashy yield that can’t be sustained. Aflac also pairs its dividend with a consistent share buyback program, which enhances shareholder returns and supports earnings per share.
Cash flow is strong. Levered free cash flow came in at $4.85 billion over the last year—more than enough to cover the roughly $1.3 billion in annual dividend payments. That kind of financial cushion gives Aflac room to maneuver even if economic conditions become more challenging.
Its balance sheet is equally sturdy. With about $8 billion in cash and debt levels that remain comfortably low, Aflac is in a position to support its dividend, continue buybacks, and reinvest in the business—all without missing a beat.
Dividend Growth and Safety
Aflac has been increasing its dividend every year for over four decades. That kind of track record isn’t just impressive—it’s the mark of a company that knows how to manage through good times and bad. This isn’t just a dividend payer; it’s a true dividend grower.
Over the past five years, the company has raised its dividend at a solid pace—typically in the mid-to-high single digits each year. That kind of consistent growth helps investors stay ahead of inflation and build real income over time.
Importantly, Aflac doesn’t need to rely on financial engineering to keep its dividend going. With a low payout ratio and strong earnings, the dividend is clearly a priority—but not a strain. And management has shown it knows how to balance competing priorities, whether that’s reinvesting in the business, buying back shares, or maintaining a reliable payout.
The company’s efficiency metrics speak for themselves. With return on assets above 3% and high profit margins, Aflac runs a lean, effective operation. Its dual-market exposure—particularly in Japan—adds a layer of geographic diversity that helps stabilize earnings over the long term.
Aflac might not make a lot of noise in the financial media, but its results do all the talking. Steady dividend increases, strong cash flow, and disciplined capital allocation make this stock a reliable part of any income-oriented portfolio. There’s no need to overcomplicate it—this is a business that simply works, and it’s been rewarding shareholders for decades.
Cash Flow Statement
Aflac’s trailing twelve-month (TTM) cash flow paints the picture of a company still generating healthy operating income, even as its numbers have come down from earlier highs. Operating cash flow came in at $2.71 billion, a step down from prior years, but still more than sufficient to cover dividends and share repurchases. What’s interesting is the turnaround in investing cash flow, which swung to a positive $2.78 billion after two years of outflows, suggesting either a wind-down of previous investments or liquidation of securities to boost liquidity.
On the financing side, the story remains consistent—capital continues flowing out. Aflac returned $2.8 billion to shareholders through stock buybacks, which remains a priority for management, and also paid down $194 million in debt. Overall financing cash flow was negative $3.49 billion, in line with previous years. The company ended the period with $6.23 billion in cash, its strongest position in four years, adding an extra layer of flexibility. Despite the dip in free cash flow from $5.05 billion in 2021 to $2.71 billion TTM, Aflac remains firmly in the green, maintaining a solid foundation to support future dividends and strategic initiatives.
Analyst Ratings
📊 Aflac (NYSE: AFL) has recently seen a mix of analyst actions reflecting a cautious yet steady outlook. The consensus among analysts is currently a “Hold” rating, with an average price target of $103.93. That puts the stock slightly above the target, as it’s trading around $106.83—implying some believe it’s fairly valued at current levels.
🚀 Earlier this month, one of the more bullish signals came from Piper Sandler. They maintained their “Overweight” rating and even bumped up their price target from $118 to $124. That move suggests they see continued upside, likely driven by the company’s stable operating cash flow, share buyback momentum, and a stronger-than-expected performance in Japan.
📈 UBS also kept a steady tone, holding firm on their “Neutral” rating but adjusting their target slightly upward from $109 to $114. That kind of move often reflects respect for consistent execution, even if the broader valuation looks fully priced in for now.
📉 On the more conservative side, Morgan Stanley reaffirmed their “Equal-Weight” stance but reduced their target from $105 to $100. Their reasoning pointed to potential margin pressure and ongoing currency headwinds from Aflac’s significant exposure to the Japanese yen, which could weigh on earnings growth if those trends persist.
🔍 Overall, analysts are balancing Aflac’s strong capital returns and solid financials against the realities of market volatility and global exposure. The mixed ratings reflect a company viewed as reliable—but not without its near-term challenges.
Earning Report Summary
Aflac wrapped up the fourth quarter of 2024 on a strong note, with numbers that show a solid end to the year—even if they didn’t blow past every expectation. Total revenue climbed to $5.4 billion, up a sharp 43% from the same quarter last year. Net earnings were also a standout, landing at $1.9 billion, or $3.42 per diluted share. That’s a massive jump from $268 million, or just $0.46 per share, during Q4 2023. A big part of that came from investment gains—about $1 billion worth, including contributions from derivatives and currency-related activity.
Even when you strip away the one-time stuff, Aflac still delivered adjusted earnings of $865 million and adjusted EPS of $1.56. Those are increases of 18% and nearly 25%, respectively. Though the numbers didn’t quite meet every analyst forecast, they show the underlying business is healthy and moving in the right direction.
Performance in Japan
Japan continues to be Aflac’s largest market, and while it faced a few headwinds this quarter, there were still bright spots. Premiums were down in yen terms—about a 5.4% dip—but that was mostly due to reinsurance activity and the natural lifecycle of policies reaching their paid-up phase. On the upside, investment income in Japan ticked up slightly, and overall pretax earnings managed to grow by 1% in yen terms.
When those numbers are converted into U.S. dollars, the picture looks a little softer. Premiums were down about 8%, and total revenues dropped 5.6%. Still, pretax earnings only slipped by a modest 1%, thanks to disciplined cost management and lower benefit payouts. The Japanese business remains a steady performer, even in the face of currency shifts and slower premium growth.
Performance in the U.S.
Back at home, Aflac’s U.S. operations had a stronger quarter. Premium income rose nearly 3%, driven by improved customer retention and gains from last year’s sales. Investment income also edged higher, and total revenues came in about 2% above the prior year’s numbers. Pretax earnings jumped more than 9%, helped by higher premiums and tighter expense control. The U.S. business posted a 19.7% pretax profit margin—up from 18.4% a year earlier—showing just how well it’s been executing.
Capital Returns and Management Commentary
On the capital side, Aflac returned $750 million to shareholders through buybacks in the fourth quarter alone. And they’re not slowing down—in fact, the company bumped up its quarterly dividend by 16%, now sitting at $0.58 per share. That marks 42 straight years of dividend increases, which should be music to any income investor’s ears.
CEO Dan Amos sounded upbeat in his remarks, pointing to strong execution across the board and a focus on profitable growth in both of Aflac’s core markets. He also mentioned efforts to roll out new products targeting younger demographics, which could help keep the growth engine running. The message from leadership was clear: steady, disciplined, and focused on long-term value.
Chart Analysis
Price Movement and Trends
AFL has put together a solid run over the past year, climbing from just under $80 to recent highs near $115 before pulling back. The chart shows a steady uptrend that gained momentum in the summer months and pushed into late fall before encountering resistance. Since then, price action has turned more sideways, with some sharper pullbacks and recoveries along the way.
The 50-day moving average (in red) moved consistently above the 200-day moving average (in blue) from mid-year onward, which is generally a sign of strength. However, more recently, the stock dipped below both moving averages before bouncing back above the 200-day line. This recent bounce suggests there’s still buying interest on the dips, especially near key technical support levels.
Volume Behavior
Volume has remained relatively stable through most of the year, with a few noticeable spikes that align with price volatility. These volume surges often came during periods of pullback or rebound, indicating active participation when the stock moves sharply. That’s usually a sign of institutional trading activity or reaction to major headlines.
Despite a few high-volume days, there’s no extended period of selling pressure that would indicate broader distribution. Volume behavior overall supports the idea of a stock still in healthy hands.
Relative Strength Index (RSI)
The RSI at the bottom of the chart has bounced frequently between 40 and 70, showing mostly neutral momentum. During the sharp rally in late summer and early fall, it briefly pushed into overbought territory but didn’t stay there long. This tells us the stock has had periods of strength without becoming overheated.
Recently, the RSI dipped near the oversold level and reversed sharply, mirroring the bounce in price. That move often points to a short-term bottom, especially when supported by strong volume and a recovery above major moving averages.
Overall View
AFL continues to show signs of a strong, stable equity that’s pulled back from highs but remains in a longer-term uptrend. While short-term volatility has increased, key technical indicators like the 200-day moving average and RSI suggest the stock is finding its footing again. There’s still solid demand showing up on dips, and price behavior supports the idea of continued strength if the broader trend holds.
Management Team
Aflac’s leadership continues to be anchored by Chairman and CEO Dan Amos, who has been with the company for over three decades. His steady hand and long-term focus have been central to the company’s consistent performance. Known for his down-to-earth leadership style and strong company culture, Amos has built a team that emphasizes financial discipline and long-term value creation.
In a notable leadership move, Virgil R. Miller was promoted to President of Aflac Incorporated, effective at the start of 2025. Miller, who also serves as President of Aflac U.S., brings two decades of experience within the company. His leadership in customer solutions and operational efficiency has played a key role in driving domestic growth, especially as Aflac pushes deeper into digital services and new product offerings.
The executive bench also includes Max K. Brodén, the Senior Executive Vice President and CFO, who oversees the company’s global investment strategy and financial performance. Audrey Boone Tillman, now Senior Executive Vice President and General Counsel, continues to lead Aflac’s legal and compliance functions with a strong focus on governance and risk management. Together, the team blends operational expertise, financial acumen, and legal oversight, helping Aflac remain stable through shifting economic cycles.
Valuation and Stock Performance
Aflac’s stock has had a solid run over the past year. As of April 11, 2025, shares closed at $106.83, which is a little below its 52-week high of $115.50. The current valuation puts Aflac’s market cap just over $58 billion, reflecting a healthy confidence in its underlying business and capital return strategy. Its trailing price-to-earnings ratio is 11.09, and the forward P/E comes in around 15.80, suggesting that expectations are modest but stable for future earnings.
On a price-to-book basis, the company trades at 2.27, which isn’t stretched, especially given its return on equity above 22 percent. Price-to-sales is just over 3, pointing to a valuation that acknowledges strong profitability while still leaving room for further upside if growth accelerates. Over the past 12 months, Aflac shares have outperformed the broader financial sector, gaining more than 33 percent. That kind of performance, combined with steady dividends and share buybacks, is the kind of total return story investors tend to appreciate over time.
Analyst sentiment is mixed but stable. The consensus price target is hovering around $103.93, which is right in line with current trading levels. Some analysts have nudged their targets higher on the back of solid execution and strong capital returns, while others remain cautious due to lingering concerns about currency fluctuations and global macro pressures.
Risks and Considerations
Despite its strong positioning, Aflac does carry a few risks that are worth watching. The most prominent is its exposure to Japan, which accounts for a substantial portion of earnings. When the yen weakens against the dollar, Aflac’s profits can take a hit, even if the business performs well locally. That currency sensitivity adds a layer of unpredictability to quarterly results, especially in a volatile global economy.
Another consideration is the regulatory environment. Changes in insurance regulations—whether in the U.S. or Japan—can influence product pricing, reserve requirements, or distribution models. While Aflac has been proactive in navigating these waters, it’s an area that demands continuous attention.
The low-interest-rate era may be shifting, but interest rate movements still affect Aflac’s investment portfolio. The company holds a large pool of fixed income assets, and fluctuations in yields can directly impact investment income, which is a meaningful part of its earnings mix. Also, competition in the supplemental insurance space has been picking up. While Aflac has strong brand equity, particularly in the U.S., new entrants and evolving customer expectations mean it will have to keep innovating to stay ahead.
Operational risks can’t be ignored either. Like all financial services firms, Aflac faces cybersecurity threats and the need to continuously update its digital infrastructure. Investments in technology are no longer optional—they’re central to both efficiency and customer experience. Aflac has made strides in digital claims and policy services, but staying ahead will require ongoing investment and adaptability.
Final Thoughts
Aflac stands out as a company that doesn’t chase headlines but delivers results year after year. With a long-tenured leadership team, a clear strategic vision, and a reputation for financial conservatism, the company continues to demonstrate that consistency and discipline matter. While it does face certain macro and operational risks—like any global insurer—its track record of navigating those challenges is strong.
The valuation suggests the market sees Aflac as fairly priced for now, but that doesn’t take away from its long-term appeal. It’s a business that generates reliable cash flow, returns capital thoughtfully, and operates with a margin of safety. Whether it’s maintaining strong underwriting in the U.S., managing currency exposure in Japan, or expanding digital capabilities, Aflac seems focused on doing the fundamentals right.
Its ability to weather storms and still deliver shareholder value has been proven time and again. For investors who appreciate steady hands at the wheel and a company built to last, Aflac remains one to watch.