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What's in Store for Lincoln National's (LNC) Q4 Earnings?
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Lincoln National Corp.’s (LNC - Free Report) fourth-quarter 2020 and full-year earnings release is scheduled for Feb 3, after market close. The company is anticipated to register a decline in earnings but an increase in revenues from the respective year-ago period’s reported figures when it announces quarterly financial numbers.
In the last reported quarter, it suffered a loss of 72 cents per share. The Zacks Consensus Estimate was of earnings of $2.16 per share. Further, the bottom line came against the year-ago quarter’s earnings of $2.22. Third-quarter results were impacted by an elevated claims experience from COVID-19.
Q4 Estimates
The Zacks Consensus Estimate for this insurance and retirement business’ quarterly earnings stands at $1.98 per share, implying a decline of 17.84% from the year-ago quarter’s reported figure.
The consensus mark for revenues is pegged at $4.61 billion, indicating a 2.25% rise from the year-earlier quarter’s reported number.
Factors Likely to Impact Q4 Results
In the company’s Annuities segment, strategic near-term actions to re-price certain products and shift sales from fixed annuity products in response to the low interest rate environment induced lower deposits in 2020 as well as caused negative net flows in the September quarter. This trend is likely to have continued in the December quarter as well. As a result, annuity sales are also expected to have dropped in the quarter to be reported.
In the company’s Life Insurance segment, sales might have taken a hit from re-pricing. The company expects sales to be meaningfully lower in the fourth quarter, partly due to record sales in the prior-year quarter. It also expects elevated mortality in the fourth quarter of 2020 as a result of COVID-19 pandemic.
However, the company’s Group Protection segment is likely to reflect an increase in sales, driven by the company’s continued focus on cross selling its suite of complimentary employee paid products to its existing customers.
During the to-be-reported quarter, the company aligned its Retirement Plan Services with its Group Benefits business line to create a broader Workplace Solutions organization. This business rejig is expected to have boosted the company’s capabilities and serve its clients, plan participants and policyholders better.
On the flip side, the prevalent low interest rate environment might have kept investment yields stressed. Net investment income — an important catalyst for the company’s top line — is likely to have suffered losses on account of alternative investments.
Meanwhile, the company is focusing on its expense discipline. During the second quarter of 2020, it implemented a plan to significantly reduce expenses in the year ahead, expecting a consistency of aggressive expense management. This strategic move, in turn, might have also decreased expenses in the company’s fourth quarter.
Earnings Surprise History
Over the last four quarters, the company’s earnings missed the consensus estimate thrice (surpassed the mark only once), the average surprise being -41.4%.
Lincoln National Corporation Price and EPS Surprise
Our proven model does not predict an earnings beat for Lincoln National 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, which is not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter
Earnings ESP: Lincoln National has an Earnings ESP of 0.00%.
Zacks Rank: Lincoln National currently has a Zacks Rank #4 (Sell).
Stocks to Consider
Some stocks worth considering with the perfect combination of elements to surpass estimates this reporting cycle are as follows:
Cincinnati Financial Corporation (CINF - Free Report) has an Earnings ESP of +2.72% and a Zacks Rank of 3, presently.
NMI Holdings Inc (NMIH - Free Report) has an Earnings ESP of +5.40% and is currently Zacks #3 Ranked.
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What's in Store for Lincoln National's (LNC) Q4 Earnings?
Lincoln National Corp.’s (LNC - Free Report) fourth-quarter 2020 and full-year earnings release is scheduled for Feb 3, after market close. The company is anticipated to register a decline in earnings but an increase in revenues from the respective year-ago period’s reported figures when it announces quarterly financial numbers.
In the last reported quarter, it suffered a loss of 72 cents per share. The Zacks Consensus Estimate was of earnings of $2.16 per share. Further, the bottom line came against the year-ago quarter’s earnings of $2.22. Third-quarter results were impacted by an elevated claims experience from COVID-19.
Q4 Estimates
The Zacks Consensus Estimate for this insurance and retirement business’ quarterly earnings stands at $1.98 per share, implying a decline of 17.84% from the year-ago quarter’s reported figure.
The consensus mark for revenues is pegged at $4.61 billion, indicating a 2.25% rise from the year-earlier quarter’s reported number.
Factors Likely to Impact Q4 Results
In the company’s Annuities segment, strategic near-term actions to re-price certain products and shift sales from fixed annuity products in response to the low interest rate environment induced lower deposits in 2020 as well as caused negative net flows in the September quarter. This trend is likely to have continued in the December quarter as well. As a result, annuity sales are also expected to have dropped in the quarter to be reported.
In the company’s Life Insurance segment, sales might have taken a hit from re-pricing. The company expects sales to be meaningfully lower in the fourth quarter, partly due to record sales in the prior-year quarter. It also expects elevated mortality in the fourth quarter of 2020 as a result of COVID-19 pandemic.
However, the company’s Group Protection segment is likely to reflect an increase in sales, driven by the company’s continued focus on cross selling its suite of complimentary employee paid products to its existing customers.
During the to-be-reported quarter, the company aligned its Retirement Plan Services with its Group Benefits business line to create a broader Workplace Solutions organization. This business rejig is expected to have boosted the company’s capabilities and serve its clients, plan participants and policyholders better.
On the flip side, the prevalent low interest rate environment might have kept investment yields stressed. Net investment income — an important catalyst for the company’s top line — is likely to have suffered losses on account of alternative investments.
Meanwhile, the company is focusing on its expense discipline. During the second quarter of 2020, it implemented a plan to significantly reduce expenses in the year ahead, expecting a consistency of aggressive expense management. This strategic move, in turn, might have also decreased expenses in the company’s fourth quarter.
Earnings Surprise History
Over the last four quarters, the company’s earnings missed the consensus estimate thrice (surpassed the mark only once), the average surprise being -41.4%.
Lincoln National Corporation Price and EPS Surprise
Lincoln National Corporation price-eps-surprise | Lincoln National Corporation Quote
Here is what our quantitative model predicts:
Our proven model does not predict an earnings beat for Lincoln National 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, which is not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter
Earnings ESP: Lincoln National has an Earnings ESP of 0.00%.
Zacks Rank: Lincoln National currently has a Zacks Rank #4 (Sell).
Stocks to Consider
Some stocks worth considering with the perfect combination of elements to surpass estimates this reporting cycle are as follows:
The Allstate Corporation (ALL - Free Report) has an Earnings ESP of +5.72% and a Zacks Rank #3, currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
Cincinnati Financial Corporation (CINF - Free Report) has an Earnings ESP of +2.72% and a Zacks Rank of 3, presently.
NMI Holdings Inc (NMIH - Free Report) has an Earnings ESP of +5.40% and is currently Zacks #3 Ranked.
Legal Marijuana: An Investor’s Dream
Imagine getting in early on a young industry primed to skyrocket from $17.7 billion in 2019 to an expected $73.6 billion by 2027.
Although marijuana stocks did better as the pandemic took hold than the market as a whole, they’ve been pushed down. This is exactly the right time to get in on selected strong companies at a fraction of their value before COVID struck. Zacks’ Special Report, Marijuana Moneymakers, reveals 10 exciting tickers for urgent consideration.
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