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.
Lincoln National (LNC) Up 25.1% Since Last Earnings Report: Can It Continue?
Read MoreHide Full Article
It has been about a month since the last earnings report for Lincoln National (LNC - Free Report) . Shares have added about 25.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Lincoln National due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Lincoln National Q1 Earnings Beat Estimates
Lincoln National’s first-quarter 2020 earnings of $2.24 per share outpaced the Zacks Consensus Estimate by 5.2%. Further, the bottom line improved 4.7% year over year.
The company’s results benefited from improvement in top-line growth, partly offset by rise in expenses.
Adjusted operating revenues of $4.5 billion improved 3% year over year.
The upside can be attributed to strong performance at its Annuities, Retirement Plan Services and Life Insurance segments. However, the top line missed the Zacks Consensus Estimate by 1.6%.
Total expenses increased 18.8% year over year to $4.4 billion, primarily due to costs related to interest credited and benefits expenses. Segmental Performance
Operating income in the Annuities segment rose 4% year over year to $261 million. This can primarily be attributed to higher average account values. Total annuity deposits improved 5% from the year-ago quarter to $3.7 billion, driven by growth in variable annuity sales.
Operating income in Retirement Plan Services increased 2.6% year over year to $40 million due to improved expense management. Total deposits improved 11% from the prior-year quarter’s value to $2.8 billion, owing to growth in recurring deposits and strong first-year sales.
Operating income in Life Insurance segment was up 9% year over year to $171 million on the back of favorable mortality and consistent business growth. However, operating revenues in this segment increased 7% year over year to $1.8 billion.
Operating income in Group Protection declined 27.3% from the year-ago quarter’s figure to $40 million. This downside was owing to unfavorable risk results. Operating revenues slipped 14.3% year over year to $102 million.
The Other Operations segment incurred a loss of $47 million, narrower than the loss of $60 million in the prior-year quarter.
Financial Update
As of Mar 31, 2020, Lincoln National’s book value per share, excluding accumulated other comprehensive income, improved 2.1% year over year to $70.24.
Adjusted operating return on equity (ROE), excluding accumulated other comprehensive income and goodwill, improved 90 bps from the year-ago quarter’s number to 13.5%.
The company ended the quarter with long-term debt of $6.7 billion, up 21.1% year over year.
As of Mar 31, 2020, the company had assets worth $318.6 billion, up 1.4% from the year-ago quarter’s number. Shareholders’ equity also inched up 1% year over year to $16.6 billion.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision. The consensus estimate has shifted -19.45% due to these changes.
VGM Scores
At this time, Lincoln National has an average Growth Score of C, however its Momentum Score is doing a bit 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 broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Lincoln National has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Lincoln National (LNC) Up 25.1% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Lincoln National (LNC - Free Report) . Shares have added about 25.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Lincoln National due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Lincoln National Q1 Earnings Beat Estimates
Lincoln National’s first-quarter 2020 earnings of $2.24 per share outpaced the Zacks Consensus Estimate by 5.2%. Further, the bottom line improved 4.7% year over year.
The company’s results benefited from improvement in top-line growth, partly offset by rise in expenses.
Adjusted operating revenues of $4.5 billion improved 3% year over year.
The upside can be attributed to strong performance at its Annuities, Retirement Plan Services and Life Insurance segments. However, the top line missed the Zacks Consensus Estimate by 1.6%.
Total expenses increased 18.8% year over year to $4.4 billion, primarily due to costs related to interest credited and benefits expenses.
Segmental Performance
Operating income in the Annuities segment rose 4% year over year to $261 million. This can primarily be attributed to higher average account values. Total annuity deposits improved 5% from the year-ago quarter to $3.7 billion, driven by growth in variable annuity sales.
Operating income in Retirement Plan Services increased 2.6% year over year to $40 million due to improved expense management. Total deposits improved 11% from the prior-year quarter’s value to $2.8 billion, owing to growth in recurring deposits and strong first-year sales.
Operating income in Life Insurance segment was up 9% year over year to $171 million on the back of favorable mortality and consistent business growth. However, operating revenues in this segment increased 7% year over year to $1.8 billion.
Operating income in Group Protection declined 27.3% from the year-ago quarter’s figure to $40 million. This downside was owing to unfavorable risk results. Operating revenues slipped 14.3% year over year to $102 million.
The Other Operations segment incurred a loss of $47 million, narrower than the loss of $60 million in the prior-year quarter.
Financial Update
As of Mar 31, 2020, Lincoln National’s book value per share, excluding accumulated other comprehensive income, improved 2.1% year over year to $70.24.
Adjusted operating return on equity (ROE), excluding accumulated other comprehensive income and goodwill, improved 90 bps from the year-ago quarter’s number to 13.5%.
The company ended the quarter with long-term debt of $6.7 billion, up 21.1% year over year.
As of Mar 31, 2020, the company had assets worth $318.6 billion, up 1.4% from the year-ago quarter’s number. Shareholders’ equity also inched up 1% year over year to $16.6 billion.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision. The consensus estimate has shifted -19.45% due to these changes.
VGM Scores
At this time, Lincoln National has an average Growth Score of C, however its Momentum Score is doing a bit 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 broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Lincoln National has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.