Wolfe Research Initiates Coverage of MetLife, Inc. - Preferred Stock (MET.PRF) with Outperform Recommendation

Wolfe Research initiated coverage of MetLife, Inc. - Preferred Stock (MET.PRF) with an Outperform recommendation on September 16, 2025. This positive analyst rating emerges amidst a mixed institutional landscape, where total shares owned by institutions decreased by 6.69% to 7,816K, and major preferred stock ETFs significantly reduced their holdings and portfolio allocations to MET.PRF, even as the average portfolio weight among the 41 reporting funds increased by 13.27%.

Analysis

A notable divergence in sentiment surrounds MetLife's preferred stock (MET.PRF). On one hand, Wolfe Research has initiated coverage with a bullish 'Outperform' recommendation, signaling confidence from a sell-side perspective. On the other hand, institutional ownership data reveals significant selling pressure. Total shares held by institutions fell by 6.69% to 7.816 million in the last quarter, with major preferred stock ETFs leading the exodus. For instance, iShares' PFF, Invesco's PGX, and Invesco's PGF reduced their holdings by 8.98%, 6.20%, and 8.49% respectively, alongside corresponding decreases in portfolio allocation. This pattern is consistent across all five major ETFs listed. Contradicting this trend, the average portfolio weight across all 41 reporting funds increased by a substantial 13.27%. This suggests that while large, passive ETFs are trimming their positions, a subset of the institutional holders are increasing their conviction and concentrating their bets on MET.PRF, creating a complex and bifurcated market view.

Key Decisions for Investors

• Investors should treat the new 'Outperform' rating with caution, weighing it against the material selling pressure from major preferred stock ETFs which could create a near-term headwind for the security's price.
• The conflicting data warrants a deeper investigation into the drivers of ETF outflows; determine if this reflects a broad sector rotation or specific concerns about MetLife's credit profile.
• The 13.27% increase in average portfolio weight, despite a decrease in total shares, signals that some active managers may be accumulating shares, so identifying these buyers could reveal a contrarian investment thesis worth considering.