3 Reasons to Avoid RGA and 1 Stock to Buy Instead

September 08, 2025 at 00:01 AM EDT

RGA Cover Image

Since March 2025, Reinsurance Group of America has been in a holding pattern, posting a small return of 3.9% while floating around $193.24. The stock also fell short of the S&P 500’s 15.5% gain during that period.

Is now the time to buy Reinsurance Group of America, or should you be careful about including it in your portfolio? Get the full stock story straight from our expert analysts, it’s free.

Why Is Reinsurance Group of America Not Exciting?

We're swiping left on Reinsurance Group of America for now. Here are three reasons why RGA doesn't excite us and a stock we'd rather own.

1. Growing BVPS Reflects Strong Asset Base

We consider book value per share (BVPS) a critical metric for insurance companies. BVPS represents the total net worth per share, providing insight into a company’s financial strength and ability to meet policyholder obligations.

Although Reinsurance Group of America’s BVPS was flat over the last five years. the good news is that its growth has recently accelerated as BVPS grew at an exceptional 24.4% annual clip over the past two years (from $117.88 to $182.37 per share).

Reinsurance Group of America Quarterly Book Value per Share

2. Projected BVPS Growth Is Slim

An insurer’s book value per share (BVPS) increases when it maintains a profitable combined ratio and effectively manages its investment portfolio.

Over the next 12 months, Consensus estimates call for Reinsurance Group of America’s BVPS to grow by 1.4% to $163.45, inadequate growth rate.

3. Previous Growth Initiatives Haven’t Impressed

Return on equity (ROE) is a crucial yardstick for insurance companies, measuring their ability to generate returns on the capital provided by shareholders. Insurers that consistently deliver superior ROE tend to create more value for their investors over time through strategic capital allocation and shareholder-friendly policies.

Over the last five years, Reinsurance Group of America has averaged an ROE of 7.4%, uninspiring for a company operating in a sector where the average shakes out around 12.5%.

Reinsurance Group of America Return on Equity

Final Judgment

Reinsurance Group of America isn’t a terrible business, but it doesn’t pass our bar. With its shares trailing the market in recent months, the stock trades at 1× forward P/B (or $193.24 per share). While this valuation is reasonable, we don’t really see a big opportunity at the moment. We're pretty confident there are more exciting stocks to buy at the moment. We’d suggest looking at one of our top software and edge computing picks.

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