J.P. Morgan Neutral On Protective Life (PL)

J.P. Morgan Chase & Co. has a Neutral rating and a $29 price target on shares of Protective Life PL. In a note to clients, J.P. Morgan writes, "We are maintaining our 2011 and 2012 EPS estimates at $3.19 and $3.46, respectively. Accretion from the UILIC and Liberty deals should lift PL's ROE from roughly 7.9% in 2010 to 8.8% in 2011. However, other than deals, we foresee modest growth in the company's business. Annuity sales should increase at a robust pace due to momentum in VAs, but our growth outlook for other products is cautious. We expect life marketing results to be challenged by high reserve funding costs and low interest rates. Low rates present a headwind for the stable value and fixed annuity businesses as well. Additionally, we expect continued high volatility in EPS due to fluctuations in life marketing mortality and trading account income. Shares of PL lost 5 cents yesterday to close at $28.99.