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What's in the Cards for Assurant (AIZ) This Earnings Season?

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Assurant, Inc. (AIZ - Free Report) is slated to report first-quarter 2018 results on May 3 after the market closes. The company delivered a positive surprise in all the trailing four quarters with an average beat of 16.3%.

Let’s see, how things are shaping up for this announcement.

Assurant’s fourth-quarter performance is expected to have been driven by a strong performance across most of its business lines.

Growth in mobile business as well as higher contributions from vehicle protection and expense efficiencies possibly have augmented operating income at Connected Living. However, declines in lender-placed and credit insurance are likely to have been a partial offset. Growth at vehicle protection business has been driven by sturdy sales made earlier.

Global Lifestyle largely benefited from higher mobile contributions from new and existing programs in fourth-quarter 2017. However, the company does not expect any increase in trade-in volumes during the first quarter 2018. This is because sales of new smartphones have been lower than expected. Nonetheless, a compelling product and client mix are expected to have aided Global Lifestyle’s performance.

Revenues and earnings at Global Preneed have probably been driven by expansion from new and existing clients and adjacent product offerings. A lower tax rate will boost its performance.

However, the company estimates lender-placed declines in its Global Housing.

Lower tax incidence owing to a drop in the tax rate will possibly cushion the bottom line. Also, continued share buybacks should have upped the metric. The Zacks Consensus Estimate for first-quarter earnings is pegged at $1.89 per share, up 1.1% year over year.

What the Quantitative Model Predicts

Our proven model does not conclusively show that Assurant is likely to beat on earnings this to-be-reported quarter. This is because a stock needs to have both a positive Earnings ESP and a bullish Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as you will see below.

Zacks ESP: Assurant has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at $1.89. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Assurant, Inc. Price and EPS Surprise

 

Zacks Rank: Assurant carries a Zacks Rank #5 (Strong Sell), which decreases the predictive power of ESP. We caution against Sell-rated stocks (4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Some stocks worth considering from the insurance industry with the right combination of elements to exceed estimates this time around are as follows:

Cigna Corporation (CI - Free Report) is set to report first-quarter earnings on May 3. The stock has an Earnings ESP of +0.62% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Allstate Corporation (ALL - Free Report) has an Earnings ESP of +3.55% and a Zacks Rank of 3. The company is scheduled to announce first-quarter earnings on May 1.

American Financial Group, Inc. (AFG - Free Report) has an Earnings ESP of +4.46% and a Zacks Rank #2. The company is slated to release first-quarter earnings on May 2.

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