CEO Dan Amos lays out possibility of Aflac stock split at $75 per share

Aflac Chairman and Chief Executive Officer Dan Amos knew precisely the audience he was playing to on Monday at the Columbus Museum on Wynnton Road.

The annual meeting of shareholders was a gathering of faithful investors, many of whom have watched their dollars multiply nicely through the years along with the Fortune 500 supplemental health and life insurer’s own growth. It racked up a profit of more than $2.5 billion on revenues of just under $21 billion in 2015 from its business in Japan and the U.S.

“Your support has helped establish a strong foundation for our company, and we have done our best to be good stewards of your trust,” said Amos, pointing out that the company founded in 1955 by three Amos brothers — one of them his late father, Paul — is coming off a celebration last fall of its 60th anniversary.

As he does each year, the CEO laid out the magic of long-term saving and investing, saying those who paid $11,100 for 1,000 shares of Aflac stock the year the company was launched and held on to them — riding the dividends and stock splits through the years — would now have 1.9 million shares.

The kicker: Those shares would be worth $130.5 million at last Friday’s closing stock price. What’s more, the person holding those shares would have received $3.1 million in cash dividends in the past year alone.

Then Amos mentioned the excitement the company felt last Thursday when its stock hit an all-time high of $69.60, two days after it released its first-quarter earnings report.

“Which brings me to a question that I’ve already been asked today: Are you considering a stock split?,” said the executive, drawing a wave of chuckles from the audience. “As you all know, most stocks in the Fortune 500 run in the range of $30 to $50,” he said. “... This decision will be with the board, but we would like for the stock to be in that range. So that would mean that our stock needs to be in the mid-$70s for a period of at least six months before we would consider a stock split.”

It may be difficult for some to remember the last time Aflac’s stock did split, something it has done only a dozen times over six decades. That last one took place in 2001, when the adjusted price — after a two-to-one split — was $26.95 per share.

For now, Amos said, the company will continue to use its strong cash flow to repurchase stock shares and pay dividends to shareholders. It increased the dividend 5.1 percent in 2015, the 33rd straight year it has risen. The company bought back $1.3 billion in shares last year and expects to repurchase $1.4 billion this year.

“Aflac’s strong capital position has allowed us to keep our promise to the policyholders, our shareholders and everyone with which we do business,” the CEO said.

This story was originally published May 2, 2016 at 5:18 PM with the headline "CEO Dan Amos lays out possibility of Aflac stock split at $75 per share."