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MetLife (MET) to Report Q3 Earnings: What's in the Offing?
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MetLife, Inc. (MET - Free Report) is scheduled to release third-quarter 2021 earnings results on Nov 3, after the closing bell. The company outpaced earnings estimates in each of the trailing four quarters.
Q3 Estimates
The Zacks Consensus Estimate for the company’s earnings per share is pegged at $1.66, which indicates a decline of 4% from the prior-year quarter.
The consensus mark for revenues stands at $16.4 billion, suggesting a dip of 0.8% from the year-ago reported number.
Factors to Note
Strong private equity returns resulting in improved variable investment income may have benefited the company’s third-quarter investment income. The Zacks Consensus Estimate for the to-be-reported quarter’s net investment income is pegged at $4.8 billion, which indicates an improvement of 2.1% from the prior-year quarter’s reported figure.
Coming to MetLife’s segments, the company’s U.S. business is likely to have benefited from solid contributions from its Group Benefits, and Retirement and Income Solutions (RIS) sub-segments. While improved variable investment income might have aided RIS’s performance, solid revenues, strong persistency rates and acquisition of Versant Health are likely to have provided a boost to the Group Benefits business in the to-be-reported quarter.
Management expects COVID-19 linked deaths to gradually witness a downtrend across Group Benefits business, which is expected to help the company in maintaining its Group Life mortality ratio well within the annual target range of 85-90%.
In the Asia segment, strong volume growth stemming from increased general account assets under management and higher variable investment income are likely to have contributed to the segment in the to-be-reported quarter.
The company’s Latin America business in the third quarter is likely to have benefited from sound investment margins and subsidization of COVID-19 linked claims, partly offset by softer underwriting results.
In the Europe, the Middle East and Africa (EMEA) segment, robust volumes, partly offset by elevated pandemic-related claims, might have shaped the segment’s performance in the to-be-reported quarter.
In the third quarter, the company’s direct expense ratio is expected to remain high due to certain investments’ timing and seasonality.
What Our Quantitative Model Unveils
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 odds of an earnings beat.
Earnings ESP: MetLife has an Earnings ESP of +1.21%. This is because the Most Accurate Estimate of $1.68 is pegged higher than the Zacks Consensus Estimate of $1.66. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Some other stocks worth considering from the insurance space with a perfect mix of elements to surpass estimates in the upcoming quarterly releases are as follows:
Athene Holding Ltd. has an Earnings ESP of +1.71% and a Zacks Rank #2.
Manulife Financial Corporation ((MFC - Free Report) ) has an Earnings ESP of +0.51% and a Zacks Rank #3.
American Equity Investment Life Holding Company (AEL - Free Report) has an Earnings ESP of +0.13% and a Zacks Rank of 3.
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MetLife (MET) to Report Q3 Earnings: What's in the Offing?
MetLife, Inc. (MET - Free Report) is scheduled to release third-quarter 2021 earnings results on Nov 3, after the closing bell. The company outpaced earnings estimates in each of the trailing four quarters.
Q3 Estimates
The Zacks Consensus Estimate for the company’s earnings per share is pegged at $1.66, which indicates a decline of 4% from the prior-year quarter.
The consensus mark for revenues stands at $16.4 billion, suggesting a dip of 0.8% from the year-ago reported number.
Factors to Note
Strong private equity returns resulting in improved variable investment income may have benefited the company’s third-quarter investment income. The Zacks Consensus Estimate for the to-be-reported quarter’s net investment income is pegged at $4.8 billion, which indicates an improvement of 2.1% from the prior-year quarter’s reported figure.
Coming to MetLife’s segments, the company’s U.S. business is likely to have benefited from solid contributions from its Group Benefits, and Retirement and Income Solutions (RIS) sub-segments. While improved variable investment income might have aided RIS’s performance, solid revenues, strong persistency rates and acquisition of Versant Health are likely to have provided a boost to the Group Benefits business in the to-be-reported quarter.
Management expects COVID-19 linked deaths to gradually witness a downtrend across Group Benefits business, which is expected to help the company in maintaining its Group Life mortality ratio well within the annual target range of 85-90%.
In the Asia segment, strong volume growth stemming from increased general account assets under management and higher variable investment income are likely to have contributed to the segment in the to-be-reported quarter.
The company’s Latin America business in the third quarter is likely to have benefited from sound investment margins and subsidization of COVID-19 linked claims, partly offset by softer underwriting results.
In the Europe, the Middle East and Africa (EMEA) segment, robust volumes, partly offset by elevated pandemic-related claims, might have shaped the segment’s performance in the to-be-reported quarter.
In the third quarter, the company’s direct expense ratio is expected to remain high due to certain investments’ timing and seasonality.
What Our Quantitative Model Unveils
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 odds of an earnings beat.
Earnings ESP: MetLife has an Earnings ESP of +1.21%. This is because the Most Accurate Estimate of $1.68 is pegged higher than the Zacks Consensus Estimate of $1.66. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
MetLife, Inc. Price and EPS Surprise
MetLife, Inc. price-eps-surprise | MetLife, Inc. Quote
Zacks Rank: MetLife carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks to Consider
Some other stocks worth considering from the insurance space with a perfect mix of elements to surpass estimates in the upcoming quarterly releases are as follows:
Athene Holding Ltd. has an Earnings ESP of +1.71% and a Zacks Rank #2.
Manulife Financial Corporation ((MFC - Free Report) ) has an Earnings ESP of +0.51% and a Zacks Rank #3.
American Equity Investment Life Holding Company (AEL - Free Report) has an Earnings ESP of +0.13% and a Zacks Rank of 3.