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CNO Financial's (CNO) Shares Rise 2% on Q4 Earnings Beat
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Shares of CNO Financial Group, Inc. (CNO - Free Report) have gained 1.7% since it reported fourth-quarter 2022 earnings on Feb 7. The quarterly results benefited on the back of improved annuity collected premiums, higher direct-to-consumer life sales and a declining level of benefits and expenses. However, the upside was partly offset by reduced insurance policy income and net investment income.
Q4 Update
CNO Financial reported fourth-quarter 2022 adjusted earnings per share (EPS) of 56 cents, which matched the Zacks Consensus Estimate and surpassed our estimate of 50 cents. However, the bottom line dropped 36% year over year.
Total revenues declined 9.4% year over year to $973.6 million in the quarter under review. The top line beat the consensus mark by 6.7% and our estimate of $917.2 million.
Insurance policy income of $626 million dipped 1% year over year and fell shy of our estimate of $659.9 million.
CNO Financial Group, Inc. Price, Consensus and EPS Surprise
CNO’s net investment income declined 20% year over year to $315.7 million in the fourth quarter.
Annuity collected premiums of $431 million rose 8% year over year.
New annualized premiums for health and life products advanced 4% year over year to $90.7 million.
Total benefits and expenses came in at $918.2 million, which dipped 1% year over year in the fourth quarter. The decline in the metric was attributable to lower amortization expenses.
Financial Update (as of Dec 31, 2022)
CNO Financial exited the fourth quarter with unrestricted cash and cash equivalents of $575.7 million, which tumbled 8.9% from the 2021-end level.
Total assets of $33,339.2 million fell 7.9% from the figure in 2021 end.
Total shareholders’ equity declined nearly four-fold from the figure as of Dec 31, 2021 to $1,400.8 million.
Book value per share plunged 72% year over year to $12.25 in the fourth quarter.
Adjusted operating return on equity came in at 8.6%, which deteriorated 350 basis points (bps) year over year.
Debt-to-capital ratio deteriorated 2,700 bps year over year to 44.8% at the fourth-quarter end.
Share Repurchase and Dividend Update
CNO Financial rewarded its shareholders with $26.1 million in the form of share buybacks worth $10 million and dividends of $16.1 million.
Full-Year Update
CNO Financial’s adjusted EPS of $2.33 slipped 16% year over year. Total revenues decreased 13.2% year over year to $3,576.8 million in 2022.
Annuity collected premiums rose 15% year over year.
Management rewarded $244.8 million to shareholders via share repurchases of $180.0 million and dividends worth $64.8 million.
Forward View
Continued favorable sales within the Consumer and Worksite Divisions are likely to benefit CNO Financial in 2023.
Of the insurance industry players that have reported fourth-quarter results so far, The Hartford Financial Services Group, Inc. (HIG - Free Report) , Assurant, Inc. (AIZ - Free Report) and Radian Group Inc. (RDN - Free Report) beat the respective Zacks Consensus Estimate for earnings.
Hartford Financial reported fourth-quarter 2022 adjusted operating earnings of $2.31 per share, which beat the Zacks Consensus Estimate by 24.2%. The bottom line advanced 14% year over year. Operating revenues of HIG improved 8.4% year over year to $4,007 million in the quarter under review. The top line also beat the consensus mark by 3.6%. Net earned premiums of $5,019 million rose 8.4% year over year in the fourth quarter. The net investment income climbed 11.7% year over year to $640 million.
Assurant’s fourth-quarter 2022 net operating income of $3.23 per share beat the Zacks Consensus Estimate by 24.7%. The bottom line increased 15% from the year-ago quarter. Total revenues were up 3.7% year over year to $2.7 billion. The top line beat the Zacks Consensus Estimate by 1.2%. AIZ’s net earned premiums of $2.3 billion climbed 4% year over year. Net investment income increased 29.2% year over year to $102.3 million.
Radian Group reported a fourth-quarter 2022 adjusted operating income of $1.05 per share, which beat the Zacks Consensus Estimate by 20.6%. The bottom line decreased 1.8% year over year. Operating revenues decreased 8.2% year over year to $307.9 million. Net premiums earned by RDN were $232.8 million, down 10.9% year over year. Net investment income increased 58% year over year to $59 million.
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CNO Financial's (CNO) Shares Rise 2% on Q4 Earnings Beat
Shares of CNO Financial Group, Inc. (CNO - Free Report) have gained 1.7% since it reported fourth-quarter 2022 earnings on Feb 7. The quarterly results benefited on the back of improved annuity collected premiums, higher direct-to-consumer life sales and a declining level of benefits and expenses. However, the upside was partly offset by reduced insurance policy income and net investment income.
Q4 Update
CNO Financial reported fourth-quarter 2022 adjusted earnings per share (EPS) of 56 cents, which matched the Zacks Consensus Estimate and surpassed our estimate of 50 cents. However, the bottom line dropped 36% year over year.
Total revenues declined 9.4% year over year to $973.6 million in the quarter under review. The top line beat the consensus mark by 6.7% and our estimate of $917.2 million.
Insurance policy income of $626 million dipped 1% year over year and fell shy of our estimate of $659.9 million.
CNO Financial Group, Inc. Price, Consensus and EPS Surprise
CNO Financial Group, Inc. price-consensus-eps-surprise-chart | CNO Financial Group, Inc. Quote
CNO’s net investment income declined 20% year over year to $315.7 million in the fourth quarter.
Annuity collected premiums of $431 million rose 8% year over year.
New annualized premiums for health and life products advanced 4% year over year to $90.7 million.
Total benefits and expenses came in at $918.2 million, which dipped 1% year over year in the fourth quarter. The decline in the metric was attributable to lower amortization expenses.
Financial Update (as of Dec 31, 2022)
CNO Financial exited the fourth quarter with unrestricted cash and cash equivalents of $575.7 million, which tumbled 8.9% from the 2021-end level.
Total assets of $33,339.2 million fell 7.9% from the figure in 2021 end.
Total shareholders’ equity declined nearly four-fold from the figure as of Dec 31, 2021 to $1,400.8 million.
Book value per share plunged 72% year over year to $12.25 in the fourth quarter.
Adjusted operating return on equity came in at 8.6%, which deteriorated 350 basis points (bps) year over year.
Debt-to-capital ratio deteriorated 2,700 bps year over year to 44.8% at the fourth-quarter end.
Share Repurchase and Dividend Update
CNO Financial rewarded its shareholders with $26.1 million in the form of share buybacks worth $10 million and dividends of $16.1 million.
Full-Year Update
CNO Financial’s adjusted EPS of $2.33 slipped 16% year over year. Total revenues decreased 13.2% year over year to $3,576.8 million in 2022.
Annuity collected premiums rose 15% year over year.
Management rewarded $244.8 million to shareholders via share repurchases of $180.0 million and dividends worth $64.8 million.
Forward View
Continued favorable sales within the Consumer and Worksite Divisions are likely to benefit CNO Financial in 2023.
Zacks Rank
CNO Financial currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Performances of Other Insurers
Of the insurance industry players that have reported fourth-quarter results so far, The Hartford Financial Services Group, Inc. (HIG - Free Report) , Assurant, Inc. (AIZ - Free Report) and Radian Group Inc. (RDN - Free Report) beat the respective Zacks Consensus Estimate for earnings.
Hartford Financial reported fourth-quarter 2022 adjusted operating earnings of $2.31 per share, which beat the Zacks Consensus Estimate by 24.2%. The bottom line advanced 14% year over year. Operating revenues of HIG improved 8.4% year over year to $4,007 million in the quarter under review. The top line also beat the consensus mark by 3.6%. Net earned premiums of $5,019 million rose 8.4% year over year in the fourth quarter. The net investment income climbed 11.7% year over year to $640 million.
Assurant’s fourth-quarter 2022 net operating income of $3.23 per share beat the Zacks Consensus Estimate by 24.7%. The bottom line increased 15% from the year-ago quarter. Total revenues were up 3.7% year over year to $2.7 billion. The top line beat the Zacks Consensus Estimate by 1.2%. AIZ’s net earned premiums of $2.3 billion climbed 4% year over year. Net investment income increased 29.2% year over year to $102.3 million.
Radian Group reported a fourth-quarter 2022 adjusted operating income of $1.05 per share, which beat the Zacks Consensus Estimate by 20.6%. The bottom line decreased 1.8% year over year. Operating revenues decreased 8.2% year over year to $307.9 million. Net premiums earned by RDN were $232.8 million, down 10.9% year over year. Net investment income increased 58% year over year to $59 million.