Aflac (AFL) Stock Forecast & Price Target

Aflac is viewed positively because management is converting capital trapped in Japan into redeployable dry powder, with about 15% of Aflac Japan FSA reserves already ceded and another 15% still available under its internal limit, supporting growth and capital return over time. The business also showed stronger earnings power, with reported EPS of $2.43 versus $1.80 consensus, while portfolio repositioning added more than $80 million of annualized net investment income and may add over $50 million more. In addition, Aflac Japan sales are expected to exceed 2025 sales in 2026, Aflac U.S. guidance points to margins above its ranges, and Tsumitasu plus broader product expansion should support organic growth.

Aflac is facing a fundamental growth slowdown as its quarter came in short of expectations, with reported EPS of $1.75 versus consensus of $1.77 and PSC of $1.76, largely due to weaker Japan performance. Japan remains the key revenue engine, but an above-target benefit ratio of 63.4%, adverse currency movements, lower sales, and delayed sales campaigns put its $80 billion JPY sales aspiration for 2026 at risk. In the U.S., net earned premiums are tracking below the 3-6% guidance range, and while management expects second-half improvement from group voluntary, dental, and vision, the current mix suggests profitability and top-line momentum are not yet improving decisively.