What’s Behind the Recent Strength in Life Stocks and Will it Continue?

Research evidence excerpt

What’s Behind the Recent Strength in Life Stocks and Will it Continue?

Financials | Global Insurance - Life

June 17, 2026

Thomas Gallagher, CFA What’s Behind the Recent Strength in Life

212-446-9439

Thomas.Gallagher@EvercoreISI.com Stocks and Will it Continue?

David Motemaden, CFA Although 2026 has been another choppy year for US life insurance

212-497-0832 stocks, several stocks have soared so far in 2Q, brining YTD

David.Motemaden@evercoreisi.com performance well into the green for most and leaving the sector well

Nicolas Lu ahead of the XLF, P&C, and alt managers (average Lifeco now up

212-497-0812 around 9% YTD), though still leaving the group slightly below traditional

Nicolas.Lu@evercoreisi.com asset managers and large cap banks.

Peter Knudsen

212-708-8497 While the life stocks have gained some relative ground on performance,

Peter.Knudsen@evercoreisi.com the average valuation still materially lags these peer financial groups,

with life still just 8x vs. P&C and trad asset managers at around 11x and

alt managers and large banks both around 13x on 2027.

Why has the life sector been strong over last few months?

We think it’s because fear over private credit risk has diminished,

favorable mortality trends in a seasonally unfavorable quarter,

increased M&A and activist activity helps a depressed sector, and the

alt manager stocks have stopped going down (we think there is

correlation and connectivity between the sectors now).

Where do we go from here?

Although alternative portfolio returns may continue to underwhelm over

the balance of 2026, limiting upside, we see some issues influencing

whether the life sector can continue to shrink its valuation discount vs.

other financials: 1) Minimal cuts to forward ests for most as spreads