Primerica (PRI) is a financial services company based in Duluth, Georgia. Primerica's former parent company was Citigroup. The company was spun off through an initial public offering (IPO) on April 1, 2010.

Key Takeaways

  • Primerica provides insurance for more than five million people and manages more than 2.5 million client investment accounts.
  • The company recorded an 8% increase in revenue to reach $2.05 billion, while profits also grew.
  • The top 5 shareholders of Primerica are Vanguard Group, Kayne Anderson Rudnick Investment Management, BlackRock, BAMCO, and Fidelity Investments.

The company describes itself as a leading distributor of financial products to middle-income households. Primerica primarily sells term life insurance plans, but it also sells mutual funds, annuities, segregated funds, managed accounts, long-term care insurance, pre-paid legal services, auto insurance, home insurance, credit monitoring, and debt management plans. 

Multilevel Marketing Model

Primerica recruits people to sell their policies by encouraging new insurance agents to sell policies to family members, friends, and co-workers and then recruiting them to join the business. Agents who work for Primerica make money by selling policies and based on the number of agents they recruit. For this reason, Primerica is considered a multilevel marketing business.

History of Primerica

Primerica was founded as A.L. Williams & Associates (A.L. Williams) in 1977 by Arthur L. Williams Jr. The company's initial sales pitch to its mostly middle-income client base was to "buy term and invest the difference." This concept was meant to illustrate how its client base could purchase sufficient protection with term life insurance, while also saving and investing in separate investment vehicles, such as mutual fund individual retirement accounts (IRAs).

Primerica provides life insurance for approximately five million people and manages more than 2.5 million client investment accounts. Primerica was the number two provider of term life insurance coverage in North America in 2019.

In 2019, the company reported $2.05 billion in revenue, up 8% from 2018. Net income climbed 13%, to reach $366.4 million, in 2019.

As of June 2020, the five largest shareholders of Primerica stock are Vanguard Group, Kayne Anderson Rudnick Investment Management, BlackRock, BAMCO, and Fidelity Investments Inc.

Top Shareholders of Primerica

SHAREHOLDER # OF SHARES % STAKE $ VALUE
Vanguard Group 4,625,788 11.34% $550.47 million
Kayne Anderson Rudnick Investments 4,356,014 10.68% $518.37 million
BlackRock  3,734,953 9.16% $444.46 million
BAMCO 2,341,642 5.74% $278.66 million
Fidelity Management 2,248,395 5.51% $267.56 million

Shareholdings obtained from SEC filings.     Percentage ownership based on 40,778,956 shares outstanding .

The Vanguard Group

The Vanguard Group is the largest shareholder of Primerica, with approximately 4.62 million shares. This is an 11.34% stake in the company, valued at approximately $550.47 million. The Vanguard Group is a registered investment advisor firm based in Malvern, Pennsylvania. The company had approximately $6.2 trillion in assets under management (AUM) as of January 31, 2020.

Kanye Anderson Rudnick Investments

Kanye Anderson Rudnick Investments is the second-largest shareholder of Primerica, with approximately 4.35 million shares. This is a 10.68% stake in the company, valued at approximately $518.37 million. Kanye Anderson Rudnick Investments invests in equity portfolios of companies that have strong, consistent growth with low business and financial risk. The company offers actively managed equity and fixed-income strategies primarily to high-net-worth individuals and institutional clients, including endowments, foundations, corporations, public funds, and pension plans.

BlackRock

BlackRock is the third-largest shareholder of Primerica, with approximately 3.73 million shares. This is a 9.16% stake in the company, valued at approximately $444.46 million. BlackRock is an American global investment management corporation based in New York City. BlackRock is the world's largest asset manager, with $7.4 trillion in AUM at the end of the fourth quarter of 2019.

BAMCO

BAMCO is the fourth-largest shareholder of Primerica, with approximately 2.34 million shares. This is a 5.74% stake in the company, valued at approximately $278.66 million. BAMCO is an investment advisory company offering investment management and financial planning services to individuals and institutional investors.

Fidelity Investments Inc.

Fidelity Investments Inc. is the fifth-largest shareholder of Primerica, with approximately 2.24 million shares. This is a 5.51% stake in the company, valued at approximately $267.56 million. Fidelity is an American multinational financial services corporation based in Boston, Massachusetts. Fidelity is one of the largest asset managers in the world, with $3.3 trillion in assets under management as of June 2020.