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Why Is Sun Life (SLF) Down 7% Since Last Earnings Report?
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A month has gone by since the last earnings report for Sun Life (SLF - Free Report) . Shares have lost about 7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Sun Life due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Sun Life Financial Q2 Earnings Beat Estimates, Fall Y/Y
Sun Life Financial delivered second-quarter 2022 underlying net income of $1.19 per share, beating the Zacks Consensus Estimate by 10.2%. The bottom line decreased 2.4% year over year.
The underlying net income of $837.3 million (C$892 million) was up 16.5% year over year. This improvement was driven by business growth, new business gains, contribution from the DentaQuest acquisition and lower incentive compensation expenses.
Insurance sales increased 19.5% year over year to $690.8 million (C$736 million), driven by increased sales in Canada and United States.
Wealth sales increased 20% year over year to $53.8 billion (C$57.4 billion) in the quarter under review.
Value of new business improved 10% to $254.4 million (C$271 million).
Segment Results
SLF Canada’s underlying net income increased 36.8% year over year to $322.9 million (C$344 million), driven by business growth, higher new business gains and experience-related items.
SLF U.S.’ underlying net income was $144.5 million (C$154 million), up 7.8% from the prior-year quarter.
SLF Asset Management’s underlying net income of $253 million (C$270 million) was flat year over year.
SLF Asia reported an underlying net income of $138.92 million (C$148 million), which rose 12.3% year over year.
Financial Update
Global assets under management were $979.25 billion (C$1,261 billion), up 12.3% year over year.
Sun Life Assurance’s Minimum Continuing Capital and Surplus Requirements (LICAT) ratio was 124% as of Jun 30, 2022, down 100 basis points year over year.
The LICAT ratio for Sun Life (including cash and other liquid assets) was 128%, down basis points year over year.
Sun Life’s return on equity was 13.1% in the second quarter, down 320 basis points year over year. The underlying ROE of 14.9% contracted 110 basis points year over year.
The leverage ratio of 25.7% deteriorated 100 basis points year over year.
Dividend Update
On Aug 3, the board of directors approved a dividend of 69 cents per share. The amount will be paid out on Sep 29, 2022 to shareholders of record at the close of business on Aug 24.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision.
The consensus estimate has shifted 6.31% due to these changes.
VGM Scores
At this time, Sun Life has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Sun Life has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Sun Life (SLF) Down 7% Since Last Earnings Report?
A month has gone by since the last earnings report for Sun Life (SLF - Free Report) . Shares have lost about 7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Sun Life due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Sun Life Financial Q2 Earnings Beat Estimates, Fall Y/Y
Sun Life Financial delivered second-quarter 2022 underlying net income of $1.19 per share, beating the Zacks Consensus Estimate by 10.2%. The bottom line decreased 2.4% year over year.
The underlying net income of $837.3 million (C$892 million) was up 16.5% year over year. This improvement was driven by business growth, new business gains, contribution from the DentaQuest acquisition and lower incentive compensation expenses.
Insurance sales increased 19.5% year over year to $690.8 million (C$736 million), driven by increased sales in Canada and United States.
Wealth sales increased 20% year over year to $53.8 billion (C$57.4 billion) in the quarter under review.
Value of new business improved 10% to $254.4 million (C$271 million).
Segment Results
SLF Canada’s underlying net income increased 36.8% year over year to $322.9 million (C$344 million), driven by business growth, higher new business gains and experience-related items.
SLF U.S.’ underlying net income was $144.5 million (C$154 million), up 7.8% from the prior-year quarter.
SLF Asset Management’s underlying net income of $253 million (C$270 million) was flat year over year.
SLF Asia reported an underlying net income of $138.92 million (C$148 million), which rose 12.3% year over year.
Financial Update
Global assets under management were $979.25 billion (C$1,261 billion), up 12.3% year over year.
Sun Life Assurance’s Minimum Continuing Capital and Surplus Requirements (LICAT) ratio was 124% as of Jun 30, 2022, down 100 basis points year over year.
The LICAT ratio for Sun Life (including cash and other liquid assets) was 128%, down basis points year over year.
Sun Life’s return on equity was 13.1% in the second quarter, down 320 basis points year over year. The underlying ROE of 14.9% contracted 110 basis points year over year.
The leverage ratio of 25.7% deteriorated 100 basis points year over year.
Dividend Update
On Aug 3, the board of directors approved a dividend of 69 cents per share. The amount will be paid out on Sep 29, 2022 to shareholders of record at the close of business on Aug 24.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision.
The consensus estimate has shifted 6.31% due to these changes.
VGM Scores
At this time, Sun Life has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Sun Life has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.