Snoopy should be proud.

One of the hazards of using a beloved icon as a corporate mascot is that it can raise people's expectations of your company. Fortunately, insurance giant MetLife (NYSE:MET) seems to be steering clear of at least some of the regulatory and ethical troubles that have hit the insurance sector recently -- and it is executing on the fundamentals side of the business as well.

Although top-line growth in premiums and fees was modest for the fourth quarter, the company managed to grow operating earnings by 15% over last year (and by 18% on a per-share basis). For those unaccustomed to analyzing big insurance companies like MetLife, operating earnings are usually favored over net income, as net income incorporates investment gains and losses that can obscure the true underlying trends in the business. MetLife had a strong quarter (and a strong year) across the board, with institutional, individual, and auto/home segments all performing well. Book value per share grew at about 10% for 2004, and the company repurchased over $500 million worth of stock in the fourth quarter.

While fourth-quarter results were important, the major news with MetLife these days is the company's acquisition of Citigroup's (NYSE:C) Travelers Life and Annuity insurance business and most of Citigroup's international insurance business.

This deal should be truly significant for MetLife. The Travelers business will make MetLife the largest life insurance company in the country and the second-largest annuity company. Moreover, the acquisition will greatly expand the company's international footprint, and the deal comes with a long-term distribution agreement with Citigroup.

Of course, there are challenges ahead. At $11.5 billion, there is no doubt that the Traveler's acquisition is a major transaction for the company, and smooth integration will be very important. What's more, narrowing interest rate spreads could pressure the business. Although management seems confident that it can continue to do well in the current environment, unexpected rate moves are an ever-present risk for most financial companies.

Finally, investors should expect that the company's share-buyback program will remain suspended at least until the company's debt/capital ratio is back around 25%.

MetLife is not the sort of undiscovered small-cap stock that The Motley Fool normally loves to talk about. Nevertheless, quality can come in many shapes and sizes, and MetLife scores well on that account. The company trades at a modest discount (on a price-to-earnings and price-to-book basis) to its peers, but it actually has a slightly above average return on equity.

Though no one should expect MetLife to be a two-bagger in a year's time, Fools looking for a high-quality financial company to fill one of their portfolio's "stalwart" slots should give MetLife a look (and, of course, do their own due diligence).

Wish you knew more about insurance? Check out the Motley Fool Insurance Center.

Fool contributor Stephen Simpson, CFA, has no ownership interest in any stocks mentioned.