Lincoln National Corporation’s (LNC - Free Report) 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 declined 11.5% year over year to $169 million.
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.
Zacks Rank & Performance of Other Insurers
Lincoln National has a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Among other insurance industry players, which have reported first-quarter earnings so far, the bottom lines of Radian Group Inc. (RDN - Free Report) , Voya Financial, Inc. (VOYA - Free Report) and Sun Life Financial Inc. (SLF - Free Report) outpaced the Zacks Consensus Estimate.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Lincoln National Corporation’s (LNC - Free Report) 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 declined 11.5% year over year to $169 million.
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.
Zacks Rank & Performance of Other Insurers
Lincoln National has a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Among other insurance industry players, which have reported first-quarter earnings so far, the bottom lines of Radian Group Inc. (RDN - Free Report) , Voya Financial, Inc. (VOYA - Free Report) and Sun Life Financial Inc. (SLF - Free Report) outpaced the Zacks Consensus Estimate.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Get the latest research report on LNC - FREE
Get the latest research report on RDN - FREE
Get the latest research report on SLF - FREE
Get the latest research report on VOYA - FREE