CNO Financial (NYSE:CNO) Ongoing Turnaround Story Says FBR

On the terming out of its debt maturities and refinancing, FBR Capital sees CNO Financial (NYSE:CNO) as continuing to turn around and moving toward normal operations.

FBR said, "...Given that the other covenants did not change much, this buyback ability is a favorable concession to common shareholders. We are keeping 2011E EPS at $0.68 as buyback potential should offset - $0.01/share in higher interest expense. We are introducing 2012E EPS of $0.78 and a 2012E RBC ratio of 354%. Our 2011 and 2012 EPS includes $53 million in share repurchase and $53 million in debt paydown, which adds - $0.03, or 4%, to 2012E EPS. This refinancing was consistent with our thesis that CNO is a continuing turnaround story, and the terming out of its debt maturities is another step towards CNO becoming a more normal operating story."

FBR Capital maintains an "Outperform" on CNO Financial Group, which closed Thursday at $6.90, down $0.09, or 1.29 percent. FBR has a price target on them of $9.