A month has gone by since the last earnings report for MetLife (MET Quick QuoteMET - Free Report) . Shares have lost about 0.9% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is MetLife due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

MetLife Q1 Earnings Beat Estimates, Revenues Rise Y/Y

MetLife reported first-quarter 2021 adjusted operating earnings of $2.20 per share, which surpassed the Zacks Consensus Estimate by 48.7%. Further, the bottom line improved 39% year over year. The company’s results were driven by rise in revenues, higher variable investment income and strong performances at the U.S. and Asia segments, partly offset by escalating costs.

Behind the Headlines

Adjusted operating revenues at MetLife were $16.7 billion, which rose 8% year over year. The upside can be attributed to higher premiums, fees and other revenues coupled with rise in net investment income. The top line also beat the Zacks Consensus Estimate by 3.1%.

Adjusted premiums, fees and other revenues excluding pension risk transfer (PRT) of $11.4 billion increased 2% year over year in the quarter under review.

Adjusted net investment income amounted to $5.3 billion, which advanced 23% year over year primarily driven by rise in variable investment income stemming from improved equity market returns.

Total expenses increased 20.6% year over year to $15.3 billion in the quarter due to elevated policyholder benefits and claims, interest credited to policyholder account balances, interest expense on debt and other expenses.

Adjusted expense ratio, excluding total notable items related to other expenses and PRT, came in at 19%, which improved 70 basis points (bps) year over year.

Adjusted book value per share in the first quarter improved 2% year over year to $53.16. Adjusted return on equity came in at 16.5%, reflecting an improvement of 390 bps year over year.

Quarterly Segment Details

U.S.

Adjusted earnings in this segment inched up 1% year over year to $784 million, courtesy of rise in variable investment income, partly offset by escalated COVID-19 mortality and Property & Casualty divestiture. Notably, results of the divested business have not been included in the company’s first-quarter results.

Adjusted premiums, fees and other revenues of the segment rose 3% year over year to $6.4 billion attributable to well-performing Group Benefits and, Retirement and Income Solutions businesses. The inclusion of Versant Health in the company’s results consequent to its buyout completion in January 2021 has provided a boost to the segment’s performance.

Asia

Adjusted earnings totaled $623 million, which surged 78% year over year. Also, adjusted earnings on a constant currency (cc) basis soared 70% year over year stemming from improved variable investment income, volume growth and sound underwriting results. Adjusted premiums, fees & other revenues climbed 4% year over year to $2.2 billion in the segment.

Latin America

Adjusted earnings slumped 58% year over year to $40 million. Also, adjusted earnings on a cc basis plunged 57% year over year primarily due to elevated COVID-19-linked claims across Mexico. Adjusted premiums, fees & other revenues declined 5% year over year to $875 million in the quarter under review.

EMEA

Adjusted earnings from EMEA totaled $71 million, which decreased 9% year over year. Also, adjusted earnings on a cc basis slid 11% year over year due to volume elevated costs and higher COVID-19 related claims. Adjusted premiums, fees & other revenues fell 3% year over year to $678 million in the quarter.

MetLife Holdings

Adjusted earnings from MetLife Holdings more than doubled year over year to $618 million attributable to rise in variable investment income and favorable impact on long-term care benefiting the segment’s underwriting results . However, adjusted premiums, fees & other revenues declined 6% year over year to $1.2 billion in the segment.

Corporate & Other

The segment reported an adjusted loss of $171 million in the first quarter, which compared favorably with the prior-year quarter’s adjusted loss of $131 million.

Financial Update

The company exited the first quarter with cash and cash equivalents of $19.6 billion, which inched down 0.8% from 2020-end level. During the quarter, long-term debt dipped 0.6% from the level at 2020 end to $14.5 billion.

As of Mar 31, 2021, the company’s shareholders’ equity was $65.9 billion, down 11.7% from the 2020-end level.

Share Repurchase & Dividend Hike Update

In the reported quarter, the company bought back shares worth $1 billion. In April 2021, the company’s board of directors approved a 4.3% hike in its quarterly dividend.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended upward during the past month.

VGM Scores

At this time, MetLife has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, MetLife has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.