We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Should You Retain Prudential (PRU) Stock in Your Portfolio?
Read MoreHide Full Article
Prudential Financial, Inc. (PRU - Free Report) remains well-poised for growth, driven by business growth, lower expenses and higher net investment spread results, cost savings initiatives, solid financial position.
Earnings Surprise History
PRU has a decent earnings surprise history. It surpassed estimates in two of the last four quarters and missed in the other two, the average being 3.64%.
Zacks Rank & Price Performance
Prudential Financial currently carries a Zacks Rank #3 (Hold). In the last six months period, PRU stock gained 2.1% compared with the industry’s increase of 3%.
Image Source: Zacks Investment Research
Return on Equity
PRU’s return on equity for the trailing 12 months is 10.2%, up 90 basis points year over year. This reflects efficiency in utilizing shareholders’ funds.
Optimistic Growth Projections
The Zacks Consensus Estimate for 2023 earnings is pegged at $11.80, indicating an improvement of 22.5% from the year-ago reported figure.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2023 earnings has moved 0.08% north in the past 30 days, reflecting analyst optimism.
Business Tailwinds
Prudential Financial’s international businesses, consisting of Life Planner and Gibraltar Life & Other, are likely to gain from continued business growth, lower expenses and higher net investment spread results. Higher premiums, policy charges and fee income attributable to the growth of business drive growth in Life Planner operations.
U.S. businesses should continue to gain from a higher net investment spread, which includes benefits from variable investment income and rising interest rates. Favorable underwriting owing to declining COVID-related mortality experience and lower expenses on the back of cost savings initiatives should also add to the upside.
PRU continues to invest in acquisitions and partnerships that enable it to grow in emerging markets. In June 2022, it established a partnership with Mercado Libre. This will enable it to deliver life insurance and accident and health products, which are customized for the platform's mass market customer base.
Prudential executed a number of strategic initiatives to reduce market sensitivity and increase growth potential, including the expansion of cost-savings program. Based on the progress of accelerating savings, PRU generated $765 million in cost savings by third- quarter of 2022, a year ahead of schedule and also more than the estimate of $750 miilion.
Prudential remains on track to become a higher-growth, less market-sensitive business. It expects to double its growth businesses to more than 30% of earnings and keep the individual annuities business to 10% or less of earnings.
Prudential Financial’s solid financial position provides it with the flexibility to execute its transformation and invest in the long-term growth of businesses.
The multi-line insurer expects to return $11 billion to shareholders via share buyback through the end of 2023, of which it has already returned $7 billion. Its capital deployment is supported by its sturdy balance sheet strength that includes highly liquid assets, additional proceeds from divestitures and a capital position that continues to support an AA financial strength rating.
Allianz’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 12.96%. In the last six months period, the insurer gained 12.2%.
The Zacks Consensus Estimate for ALIZY’s 2023 earnings has moved 0.8% north in the past 30 days. The Zacks Consensus Estimate for Allianz’s 2023 earnings per share indicates year-over-year increases of 47.2%.
MGIC Investment’s earnings surpassed estimates in each of the last four quarters, the average beat being 36.34%. In the last six months period, MTG stock gained 1.5%.
The Zacks Consensus Estimate for MTG’s 2023 earnings has moved 0.4% north in the past 30 days.
Kinsale Capital’s earnings surpassed estimates in each of the last four quarters, the average being 15.16%. In the last six months period, KNSL gained 10.7%.
The Zacks Consensus Estimate for KNSL’s 2023 earnings implies a respective year-over-year rise of 22.4%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Should You Retain Prudential (PRU) Stock in Your Portfolio?
Prudential Financial, Inc. (PRU - Free Report) remains well-poised for growth, driven by business growth, lower expenses and higher net investment spread results, cost savings initiatives, solid financial position.
Earnings Surprise History
PRU has a decent earnings surprise history. It surpassed estimates in two of the last four quarters and missed in the other two, the average being 3.64%.
Zacks Rank & Price Performance
Prudential Financial currently carries a Zacks Rank #3 (Hold). In the last six months period, PRU stock gained 2.1% compared with the industry’s increase of 3%.
Image Source: Zacks Investment Research
Return on Equity
PRU’s return on equity for the trailing 12 months is 10.2%, up 90 basis points year over year. This reflects efficiency in utilizing shareholders’ funds.
Optimistic Growth Projections
The Zacks Consensus Estimate for 2023 earnings is pegged at $11.80, indicating an improvement of 22.5% from the year-ago reported figure.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2023 earnings has moved 0.08% north in the past 30 days, reflecting analyst optimism.
Business Tailwinds
Prudential Financial’s international businesses, consisting of Life Planner and Gibraltar Life & Other, are likely to gain from continued business growth, lower expenses and higher net investment spread results. Higher premiums, policy charges and fee income attributable to the growth of business drive growth in Life Planner operations.
U.S. businesses should continue to gain from a higher net investment spread, which includes benefits from variable investment income and rising interest rates. Favorable underwriting owing to declining COVID-related mortality experience and lower expenses on the back of cost savings initiatives should also add to the upside.
PRU continues to invest in acquisitions and partnerships that enable it to grow in emerging markets. In June 2022, it established a partnership with Mercado Libre. This will enable it to deliver life insurance and accident and health products, which are customized for the platform's mass market customer base.
Prudential executed a number of strategic initiatives to reduce market sensitivity and increase growth potential, including the expansion of cost-savings program. Based on the progress of accelerating savings, PRU generated $765 million in cost savings by third- quarter of 2022, a year ahead of schedule and also more than the estimate of $750 miilion.
Prudential remains on track to become a higher-growth, less market-sensitive business. It expects to double its growth businesses to more than 30% of earnings and keep the individual annuities business to 10% or less of earnings.
Prudential Financial’s solid financial position provides it with the flexibility to execute its transformation and invest in the long-term growth of businesses.
The multi-line insurer expects to return $11 billion to shareholders via share buyback through the end of 2023, of which it has already returned $7 billion. Its capital deployment is supported by its sturdy balance sheet strength that includes highly liquid assets, additional proceeds from divestitures and a capital position that continues to support an AA financial strength rating.
Stocks to Consider
Some better-ranked stocks from the insurance industry are Allianz SE (ALIZY - Free Report) , MGIC Investment Corporation (MTG - Free Report) and Kinsale Capital Group, Inc. (KNSL - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Allianz’s earnings surpassed estimates in each of the last four quarters, the average earnings surprise being 12.96%. In the last six months period, the insurer gained 12.2%.
The Zacks Consensus Estimate for ALIZY’s 2023 earnings has moved 0.8% north in the past 30 days. The Zacks Consensus Estimate for Allianz’s 2023 earnings per share indicates year-over-year increases of 47.2%.
MGIC Investment’s earnings surpassed estimates in each of the last four quarters, the average beat being 36.34%. In the last six months period, MTG stock gained 1.5%.
The Zacks Consensus Estimate for MTG’s 2023 earnings has moved 0.4% north in the past 30 days.
Kinsale Capital’s earnings surpassed estimates in each of the last four quarters, the average being 15.16%. In the last six months period, KNSL gained 10.7%.
The Zacks Consensus Estimate for KNSL’s 2023 earnings implies a respective year-over-year rise of 22.4%.