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Brighthouse (BHF) Q1 Earnings and Revenues Beat, Rise Y/Y
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Brighthouse Financial Inc.'s (BHF - Free Report) first-quarter 2021 adjusted net income of $4.86 per share surpassed the Zacks Consensus Estimate by 100.3%. Moreover, the bottom line improved 86.9% year over year.
The reported quarter witnessed continued sales growth in annuities and lower expenses.
Brighthouse Financial, Inc. Price, Consensus and EPS Surprise
Total operating revenues of $2.4 billion beat the Zacks Consensus Estimate by 9.1%. Moreover, the top line improved 16.2% year over year, driven by higher universal life and investment-type product policy fees, net investment income as well as other income.
Premiums of $184 million decreased 7.1% year over year.
Adjusted net investment income was $1.2 billion in the quarter under review, up 29% year over year. The improvement was driven primarily by higher alternative investment income. Investment income yield was 5.12%.
Total expenses decreased 37.6% year over year to $1.7 billion due to a decrease in policyholder benefits and claims and interest expense on debt. Corporate expenses were $203 million.
Quarterly Segmental Update
Annuities reported adjusted operating income of $336 million, up 6.3% year over year, reflecting higher net investment income, higher fees and lower reserves, partially offset by higher deferred acquisition costs ("DAC") amortization and higher expenses. Annuity sales increased 8% to $2.1 billion driven by higher sales of Shield Level Annuities and variable annuities with FlexChoice Access.
Life generated adjusted operating income of $44 million, up almost four fold year over year driven by higher net investment income, partially offset by a lower underwriting margin. Life insurance sales increased 44% to $23 million.
Adjusted operating earnings of Run-off were $76 million, rebounding from the year-ago loss of $70 million, reflecting higher net investment income.
Adjusted operating loss at Corporate & Other was $69 million, which was wider than the prior-year loss of $46 million due to higher total preferred stock dividends.
Financial Update
Cash and cash equivalents were $4 billion, down 2% from 2020 end.
Shareholders’ equity of $15 billion at the end of the quarter decreased 16.7% from 2020 end.
Book value per share, excluding accumulated other comprehensive income (AOCI), was $118.24 as of Dec 31, 2020, down 4.7% from 2020 end.
As of Mar 31,2021, estimated combined RBC ratio was between 500% and 520%.
Share Buyback Program
Brighthouse bought back shares worth $68 million in the quarter under review with another $55 million through May 7.
First-quarter earnings of Lincoln Financial (LNC - Free Report) and Primerica (PRI - Free Report) beat the Zacks Consensus Estimate while that of American Equity Investment (AEL - Free Report) missed the same.
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Brighthouse (BHF) Q1 Earnings and Revenues Beat, Rise Y/Y
Brighthouse Financial Inc.'s (BHF - Free Report) first-quarter 2021 adjusted net income of $4.86 per share surpassed the Zacks Consensus Estimate by 100.3%. Moreover, the bottom line improved 86.9% year over year.
The reported quarter witnessed continued sales growth in annuities and lower expenses.
Brighthouse Financial, Inc. Price, Consensus and EPS Surprise
Brighthouse Financial, Inc. price-consensus-eps-surprise-chart | Brighthouse Financial, Inc. Quote
Behind the Headlines
Total operating revenues of $2.4 billion beat the Zacks Consensus Estimate by 9.1%. Moreover, the top line improved 16.2% year over year, driven by higher universal life and investment-type product policy fees, net investment income as well as other income.
Premiums of $184 million decreased 7.1% year over year.
Adjusted net investment income was $1.2 billion in the quarter under review, up 29% year over year. The improvement was driven primarily by higher alternative investment income. Investment income yield was 5.12%.
Total expenses decreased 37.6% year over year to $1.7 billion due to a decrease in policyholder benefits and claims and interest expense on debt. Corporate expenses were $203 million.
Quarterly Segmental Update
Annuities reported adjusted operating income of $336 million, up 6.3% year over year, reflecting higher net investment income, higher fees and lower reserves, partially offset by higher deferred acquisition costs ("DAC") amortization and higher expenses. Annuity sales increased 8% to $2.1 billion driven by higher sales of Shield Level Annuities and variable annuities with FlexChoice Access.
Life generated adjusted operating income of $44 million, up almost four fold year over year driven by higher net investment income, partially offset by a lower underwriting margin. Life insurance sales increased 44% to $23 million.
Adjusted operating earnings of Run-off were $76 million, rebounding from the year-ago loss of $70 million, reflecting higher net investment income.
Adjusted operating loss at Corporate & Other was $69 million, which was wider than the prior-year loss of $46 million due to higher total preferred stock dividends.
Financial Update
Cash and cash equivalents were $4 billion, down 2% from 2020 end.
Shareholders’ equity of $15 billion at the end of the quarter decreased 16.7% from 2020 end.
Book value per share, excluding accumulated other comprehensive income (AOCI), was $118.24 as of Dec 31, 2020, down 4.7% from 2020 end.
As of Mar 31,2021, estimated combined RBC ratio was between 500% and 520%.
Share Buyback Program
Brighthouse bought back shares worth $68 million in the quarter under review with another $55 million through May 7.
Zacks Rank & Peer Releases
Brighthouse currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
First-quarter earnings of Lincoln Financial (LNC - Free Report) and Primerica (PRI - Free Report) beat the Zacks Consensus Estimate while that of American Equity Investment (AEL - Free Report) missed the same.
Bitcoin, Like the Internet Itself, Could Change Everything
Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities.
Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
See 3 crypto-related stocks now >>