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Here's What to Expect From Unum Group (UNM) Q3 Earnings
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Unum Group (UNM - Free Report) is slated to report third-quarter 2022 earnings on Nov 1, after market close. The company delivered an earnings surprise of 55.28% in the last reported quarter.
Factors to Note
The Unum U.S. segment is likely to have benefited from higher premium levels in the employee benefits lines, individual disability and voluntary benefits, growth in the in-force block, solid persistency, and growth in the dental and vision product line. The Zacks Consensus Estimate for third-quarter premium income at the Unum U.S. segment is pegged at $4.1 billion, implying an improvement of 4.1% from the prior-year reported figure. We expect premium to increase 3.5% to $1.6 billion.
Improvement in mortality rates is likely to have favored Unum US Group Life and AD&D business.
Continued higher persistency, higher sales and favorable incidence in all the product lines and management’s focus on moving on to a mix of businesses with higher growth and stable margins likely have favored performance at Colonial Life. The Zacks Consensus Estimate for third-quarter premium income at the Colonial Life segment stands at $433 million, indicating an increase of 2.9% from the prior-year level. We estimate premium to rise 1.8% to $428.4 million.
Growth in the in-force block, resulting from the impact of rate increases in the group long-term disability product line, and higher persistency are likely to have benefited Unum International in the to-be-reported quarter. The Zacks Consensus Estimate for third-quarter premium income at the Unum International segment stands at $178 million. We estimate premium to rise 6.2% to $192.9 million.
A lower level of invested assets and a decrease in the yield on invested assets are likely to have weighed on net investment income. This downside may have been partially offset by higher miscellaneous investment income related to private equity partnerships as well as an improvement in interest rate. UNM estimates income from alternatives in the $20 million to $25 million range in the to-be-reported quarter. The Zacks Consensus Estimate for the same is pegged at $520 million, indicating a 5.5% decline from the prior-year quarter. We expect net investment income to be $519.9 million.
Expenses are likely to have decreased due to lower benefits and change in reserves for future benefits, partially offset by higher interest and debt expense, amortization of deferred acquisition costs and other expenses. We expect total benefits and expenses to rise 4.5% to $2.7 billion.
A continued share buyback is likely to have provided a boost to the bottom line.
The Zacks Consensus Estimate for earnings per share is pegged at $1.40, indicating an increase of 35.9% from the year-ago reported figure. Our estimate for third-quarter EPS is $1.41.
Quantitative Model Prediction
Our proven model does not conclusively predict an earnings beat for Unum Group 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 an earnings beat. This is not the case as you can see below.
Earnings ESP: It has an Earnings ESP of -3.04%. This is because the Most Accurate Estimate is pegged at $1.36, lower than the Zacks Consensus Estimate of $1.40. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Some stocks from the insurance space that have the perfect mix of elements to surpass earnings estimates this time around are as follows:
Enact Holdings (ACT - Free Report) has an Earnings ESP of +1.69% and a Zacks Rank of 3. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at 89 cents, indicating an increase of 5.9% from the year-ago reported figure.
ACT’s earnings beat estimates in the last four reported quarters.
EverQuote (EVER - Free Report) has an Earnings ESP of +4.88% and a Zacks Rank #2. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at a loss of 41 cents per share, wider than the year-ago loss of 18 cents.
EVER’s earnings beat estimates in three of the last four reported quarters, while missing in one.
Trean Insurance Group has an Earnings ESP of +11.11% and a Zacks Rank of 3. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at 9 cents, indicating a decrease of 40% from the year-ago reported figure.
TIG’s earnings beat estimates in one of the last four reported quarters, missed in two and met the mark in one.
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Here's What to Expect From Unum Group (UNM) Q3 Earnings
Unum Group (UNM - Free Report) is slated to report third-quarter 2022 earnings on Nov 1, after market close. The company delivered an earnings surprise of 55.28% in the last reported quarter.
Factors to Note
The Unum U.S. segment is likely to have benefited from higher premium levels in the employee benefits lines, individual disability and voluntary benefits, growth in the in-force block, solid persistency, and growth in the dental and vision product line. The Zacks Consensus Estimate for third-quarter premium income at the Unum U.S. segment is pegged at $4.1 billion, implying an improvement of 4.1% from the prior-year reported figure. We expect premium to increase 3.5% to $1.6 billion.
Improvement in mortality rates is likely to have favored Unum US Group Life and AD&D business.
Continued higher persistency, higher sales and favorable incidence in all the product lines and management’s focus on moving on to a mix of businesses with higher growth and stable margins likely have favored performance at Colonial Life. The Zacks Consensus Estimate for third-quarter premium income at the Colonial Life segment stands at $433 million, indicating an increase of 2.9% from the prior-year level. We estimate premium to rise 1.8% to $428.4 million.
Growth in the in-force block, resulting from the impact of rate increases in the group long-term disability product line, and higher persistency are likely to have benefited Unum International in the to-be-reported quarter. The Zacks Consensus Estimate for third-quarter premium income at the Unum International segment stands at $178 million. We estimate premium to rise 6.2% to $192.9 million.
A lower level of invested assets and a decrease in the yield on invested assets are likely to have weighed on net investment income. This downside may have been partially offset by higher miscellaneous investment income related to private equity partnerships as well as an improvement in interest rate. UNM estimates income from alternatives in the $20 million to $25 million range in the to-be-reported quarter. The Zacks Consensus Estimate for the same is pegged at $520 million, indicating a 5.5% decline from the prior-year quarter. We expect net investment income to be $519.9 million.
Expenses are likely to have decreased due to lower benefits and change in reserves for future benefits, partially offset by higher interest and debt expense, amortization of deferred acquisition costs and other expenses. We expect total benefits and expenses to rise 4.5% to $2.7 billion.
A continued share buyback is likely to have provided a boost to the bottom line.
The Zacks Consensus Estimate for earnings per share is pegged at $1.40, indicating an increase of 35.9% from the year-ago reported figure. Our estimate for third-quarter EPS is $1.41.
Quantitative Model Prediction
Our proven model does not conclusively predict an earnings beat for Unum Group 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 an earnings beat. This is not the case as you can see below.
Earnings ESP: It has an Earnings ESP of -3.04%. This is because the Most Accurate Estimate is pegged at $1.36, lower than the Zacks Consensus Estimate of $1.40. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Unum Group Price and EPS Surprise
Unum Group price-eps-surprise | Unum Group Quote
Zacks Rank: Unum Group currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks to Consider
Some stocks from the insurance space that have the perfect mix of elements to surpass earnings estimates this time around are as follows:
Enact Holdings (ACT - Free Report) has an Earnings ESP of +1.69% and a Zacks Rank of 3. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at 89 cents, indicating an increase of 5.9% from the year-ago reported figure.
ACT’s earnings beat estimates in the last four reported quarters.
EverQuote (EVER - Free Report) has an Earnings ESP of +4.88% and a Zacks Rank #2. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at a loss of 41 cents per share, wider than the year-ago loss of 18 cents.
EVER’s earnings beat estimates in three of the last four reported quarters, while missing in one.
Trean Insurance Group has an Earnings ESP of +11.11% and a Zacks Rank of 3. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at 9 cents, indicating a decrease of 40% from the year-ago reported figure.
TIG’s earnings beat estimates in one of the last four reported quarters, missed in two and met the mark in one.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.