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MetLife (MET) to Post Earnings in Q2: What's in Store?

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MetLife, Inc. (MET - Free Report) is scheduled to report second-quarter earnings on Aug 5, after the closing bell. The company's bottom and top-line estimates indicate a decline in each case from the respective year-ago quarter's reported numbers.

In the last reported quarter, MetLife’s earnings of $1.58 per share beat the Zacks Consensus Estimate by 8.97% and also improved 6.7% year over year.

Q220 Earnings and Revenue Estimates

The Zacks Consensus Estimate for second-quarter earnings is pegged at 96 cents per share, suggesting a decline of 30.43% from the prior-year quarter’s reported number. The consensus mark for revenues stands at $15.36 billion, indicating a 6.65% decrease from the year-ago quarter’s reported figure.

Factors at Play

Property&Casualty results are likely to reflect catastrophe-triggered losses in homeowners and auto. However, P&C auto is likely to have gained from lower auto frequency amid the COVID-19 shelter-in-place orders.

The company expects second-quarter sales to be stressed in most of its markets with a risk of further pressure looming on.

In Latin America, earnings are likely to have been affected by weak equity markets, impacting its Chilean encaje returns.

EMEA earnings are likely to have taken a hit from softness in equity markets and depressed underwriting margins, partially offset by better expense margins and solid volume growth across the region.

Low interest rate environment might have weighed on net investment income because of decreased investment yields.

Management anticipates the maximum impact on earnings to be felt within the company's variable investment income wherein it expects less favorable private equity returns.

Share repurchases made by MetLife in the to-be-reported quarter are likely to have benefited its bottom line.

Earnings Surprise History

The company boasts an attractive earnings surprise history. Its bottom line beat estimates in three of the last four quarters (and missed the mark in one), the surprise being 11.45%, on average. This is depicted in the chart below:

MetLife, Inc. Price and EPS Surprise

Here is what our quantitative model predicts:

Our proven model predicts an earnings beat for MetLife this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: MetLife has an Earnings ESP of +2.51%.
Zacks Rank: MetLife currently has a Zacks Rank #3.

Other Stocks to Consider

Some other stocks worth considering from the insurance industry with the apt combination of elements to surpass estimates this reporting cycle are as follows:

Conifer Holdings, Inc. (CNFR - Free Report) has an Earnings ESP of +68.42% and a Zacks Rank of 3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Lincoln National Corp. (LNC - Free Report) has an Earnings ESP of +1.87% and is presently Zacks #3 Ranked.

Sun Life Financial Inc. (SLF - Free Report) has an Earnings ESP of +1.22% and is currently a #3 Ranked player.
 

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