Prudential PLC (PUK-N)

It is cheap at 10X earnings, with a 3.04% dividend. Momentum is good, with a 34% YTD gain. It has only lost money once in the past decade, and decent (10%+) growth is predicted. Prudential is on track to achieve its 10% (or higher) growth target for new-business profit (NBP), gross operating free surplus generation (OFSG), operating profit after tax (OPAT) and dividend per share. NBP gains will be driven by further strength at its flagship HK unit, led by active-agents expansion and a product-mix improvement toward health and protection policies. The latter will also be promoted across other key markets, along with the repricing of medical policies to bolster profitability. The mainland China unit could see a recovery in the new-business margin on strong sales of participating policies, despite the downturn in bond yields which lowered investment-return assumption. Robust new-business and cost-improvement effort will support OFSG and OPAT, the bases for dividend gains. We think it looks fine, but keep our first line above in mind, please.
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Yields 5.5% and trades at 7x PE. This makes him think that something is wrong here, not cheap. Be careful.

Pure play insurance company in South-East Asia & Hong Kong.
Benefiting from growth in insurance market in Asia.
Expecting long term growth.
Believes fundamentals strong for emerging market growth.

Habitually rates are higher than your average life co. He likes the space because it is one of the spaces out there that benefits from the normalization of long term bonds. Expects lifecos to be amongst the best performing.

(Top Pick Sep 11/13, Up 33.03%) He would cut back because it is overweight.

Largest life insurer in the UK. Kind of a household name there. About half of its business is derived from Asia with the 2^nd largest portion being from the US and a 3^rd from the UK. This is a growth company, not a maximized dividend payout type, because the focus is on Asia. Good combination of defensiveness, cash generation and growth. The upside potential outweighs the downside risk.

Big wealth management book. Exposed to Indonesia, Malaysia, Hong Kong, Taiwan, Korea, etc. There is potential noise that it is going to spin off the US business.

Insurance company based in the UK. Have old legacy business, which is slow growing, as well as a business in the US plus a high growth business in Asia, which is insurance and wealth management. The Asian business is effectively the story. Strong balance sheet. 2.7% yield. There is a rumour that they may spin off the US asset which would create some big upside.