For the second consecutive day, Aflac’s embattled stock regained some of the losses it suffered over the last week.
Trading higher on the strength of an upgrade by Merrill Lynch, Aflac’s stock closed at $25.06 a share Wednesday in trading on the New York Stock Exchange. The $2.92 per share gain was a 13-percent improvement.
The stock lost nearly 50 percent of its value starting last Thursday when analysts’ concerns about the Columbus-based supplemental insurance company’s exposure to risky hybrid investment securities issued by European financial firms were made public.
The Merrill Lynch upgrade to buy was issued Wednesday. The language in the report by analyst Edward A. Spehar was strong.
“In our opinion, the recent sell-off in (Aflac) shares has given investors the opportunity to invest in one of the best companies on our coverage list, and arguably in all of financial services, at a compelling price, " the report stated.
The sell-off started a week ago and it was dramatic. Last Thursday, the stock lost more than 36 percent of its value after a report was released by Morgan Stanley analyst Nigel Dally, who recommended investors avoid buying Aflac before the release of fourth-quarter earnings on Feb. 2.
Because of the scheduled earnings release, Aflac has been in a “quiet period” and has not made any significant comments about the dramatic loss of stock value.
The stock took a second hit on Monday when it fell 20 percent. It has clawed back the last two trading days, gaining about 13 percent each session.
In addition to the Merrill Lynch upgrade, Sterne Agee & Leach upgraded Aflac from a sell to neutral.