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Will Rising Premiums Drive MetLife's (MET) Q4 Earnings?
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MetLife, Inc. (MET - Free Report) is poised to surpass fourth-quarter 2023 earnings expectations. The results, to be announced on Jan 31, after the closing bell, are anticipated to reflect sustained growth in net investment income and profits from most of the international operations.
What Do the Estimates Say?
The Zacks Consensus Estimate for fourth-quarter earnings per share of $1.95 suggests a 25.8% increase from the prior-year figure of $1.55. The consensus mark has remained stable over the past week. The consensus estimate for fourth-quarter revenues of $18.1 billion indicates a 14.1% increase from the year-ago reported figure.
MetLife beat the consensus estimate for earnings in one of the trailing four quarters and missed on the other three occasions, with the average surprise being negative 6.2%. This is depicted in the graph below:
Nevertheless, our proven model predicts a likely 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 chances of an earnings beat, which is precisely the case here.
Earnings ESP: MetLife has an Earnings ESP of +1.54%. This is because the Most Accurate Estimate is currently pegged at $1.98 per share, higher than the Zacks Consensus Estimate of $1.95. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: MetLife currently has a Zacks Rank #3.
Before we get into what to expect for the to-be-reported quarter in detail, it’s worth taking a look at MET’s previous-quarter performance first.
Q3 Earnings Rewind
In the last reported quarter, the leading insurance-based global financial services company reported adjusted operating earnings per share of $1.97, missing the Zacks Consensus Estimate by 1% due to higher net derivative losses. The negatives were partially offset by lower expenses, higher investment returns, volume growth across some segments and improved contributions from the U.S., Latin America and EMEA businesses.
Rising premiums from most of the businesses and investment income are expected to have buoyed MetLife’s fourth-quarter results. Improving operations in the domestic, as well as the international markets, especially in Asia and Latin America, are major positives.
The Zacks Consensus Estimate for total premiums for the quarter under review suggests a jump of 20% from the prior-year quarter. Also, the consensus mark for net investment income indicates a more than 9% year-over-year increase from the year-ago period on the back of the high interest rate environment and rising private equity returns.
Improving profits from the U.S., Asia and Latin American operations are expected to have positioned the company for significant growth from the year-ago period and a potential earnings beat. Growing variable investment income is likely to have aided the Asia segment, while the Latin America business is expected to have gained from higher volumes and favorable underwriting.
The Zacks Consensus Estimates for adjusted earnings from U.S., Asia and Latin America operations indicate almost 8%, 105% and 18% year-over-year growth, respectively. Moreover, the consensus estimate for Group Benefits’ adjusted earnings suggests a 4.2% increase from the prior-year quarter’s reading. The company is expected to have witnessed 11.6% higher profits from Retirement & Income Solutions.
However, rising costs and expenses are likely to have partially offset the profit growth levels in the to-be-reported quarter. Also, the consensus estimate indicates that Universal Life and Investment-Type Product Policy Fees for the fourth quarter will see a 1% year-over-year decrease.
The Zacks Consensus Estimate for adjusted earnings from the EMEA operations suggests a nearly 5% decline from the year-ago period. Moreover, the consensus mark for MetLife Holdings’ adjusted earnings indicates a nearly 10% year-over-year decline in the fourth quarter.
Other Stocks That Warrant a Look
Here are some other companies worth considering from the broader Finance space, as our model shows that these, too, have the right combination of elements to beat on earnings this time around:
The Zacks Consensus Estimate for CNO Financial’s bottom line for the to-be-reported quarter suggests a 51.8% year-over-year jump to 85 cents per share. The estimate remained stable over the past week. The consensus mark for CNO’s revenues is pegged at $934.1 million.
Everest Group, Ltd. (EG - Free Report) has an Earnings ESP of +1.18% and is a Zacks #3 Ranked player.
The Zacks Consensus Estimate for Everest’s bottom line for the to-be-reported quarter indicates a 19.8% year-over-year increase. The estimate remained stable over the past week. Furthermore, EG beat earnings estimates in three of the past four quarters and missed once, with the average surprise being 24.5%.
Arch Capital Group Ltd. (ACGL - Free Report) has an Earnings ESP of +1.24% and a Zacks Rank of 3.
The Zacks Consensus Estimate for Arch Capital’s bottom line for the to-be-reported quarter is pegged at $1.94 per share, which increased by 4 cents in the past month. ACGL beat earnings estimates in all the past four quarters, with an average surprise of 35.2%.
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Will Rising Premiums Drive MetLife's (MET) Q4 Earnings?
MetLife, Inc. (MET - Free Report) is poised to surpass fourth-quarter 2023 earnings expectations. The results, to be announced on Jan 31, after the closing bell, are anticipated to reflect sustained growth in net investment income and profits from most of the international operations.
What Do the Estimates Say?
The Zacks Consensus Estimate for fourth-quarter earnings per share of $1.95 suggests a 25.8% increase from the prior-year figure of $1.55. The consensus mark has remained stable over the past week. The consensus estimate for fourth-quarter revenues of $18.1 billion indicates a 14.1% increase from the year-ago reported figure.
MetLife beat the consensus estimate for earnings in one of the trailing four quarters and missed on the other three occasions, with the average surprise being negative 6.2%. This is depicted in the graph below:
MetLife, Inc. Price and EPS Surprise
MetLife, Inc. price-eps-surprise | MetLife, Inc. Quote
What the Quantitative Model Suggests
Nevertheless, our proven model predicts a likely 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 chances of an earnings beat, which is precisely the case here.
Earnings ESP: MetLife has an Earnings ESP of +1.54%. This is because the Most Accurate Estimate is currently pegged at $1.98 per share, higher than the Zacks Consensus Estimate of $1.95. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: MetLife currently has a Zacks Rank #3.
Before we get into what to expect for the to-be-reported quarter in detail, it’s worth taking a look at MET’s previous-quarter performance first.
Q3 Earnings Rewind
In the last reported quarter, the leading insurance-based global financial services company reported adjusted operating earnings per share of $1.97, missing the Zacks Consensus Estimate by 1% due to higher net derivative losses. The negatives were partially offset by lower expenses, higher investment returns, volume growth across some segments and improved contributions from the U.S., Latin America and EMEA businesses.
Now, let’s see how things have shaped up prior to the fourth-quarter earnings announcement.
Factors Driving Q4 Performance
Rising premiums from most of the businesses and investment income are expected to have buoyed MetLife’s fourth-quarter results. Improving operations in the domestic, as well as the international markets, especially in Asia and Latin America, are major positives.
The Zacks Consensus Estimate for total premiums for the quarter under review suggests a jump of 20% from the prior-year quarter. Also, the consensus mark for net investment income indicates a more than 9% year-over-year increase from the year-ago period on the back of the high interest rate environment and rising private equity returns.
Improving profits from the U.S., Asia and Latin American operations are expected to have positioned the company for significant growth from the year-ago period and a potential earnings beat. Growing variable investment income is likely to have aided the Asia segment, while the Latin America business is expected to have gained from higher volumes and favorable underwriting.
The Zacks Consensus Estimates for adjusted earnings from U.S., Asia and Latin America operations indicate almost 8%, 105% and 18% year-over-year growth, respectively. Moreover, the consensus estimate for Group Benefits’ adjusted earnings suggests a 4.2% increase from the prior-year quarter’s reading. The company is expected to have witnessed 11.6% higher profits from Retirement & Income Solutions.
However, rising costs and expenses are likely to have partially offset the profit growth levels in the to-be-reported quarter. Also, the consensus estimate indicates that Universal Life and Investment-Type Product Policy Fees for the fourth quarter will see a 1% year-over-year decrease.
The Zacks Consensus Estimate for adjusted earnings from the EMEA operations suggests a nearly 5% decline from the year-ago period. Moreover, the consensus mark for MetLife Holdings’ adjusted earnings indicates a nearly 10% year-over-year decline in the fourth quarter.
Other Stocks That Warrant a Look
Here are some other companies worth considering from the broader Finance space, as our model shows that these, too, have the right combination of elements to beat on earnings this time around:
CNO Financial Group, Inc. (CNO - Free Report) has an Earnings ESP of +8.24% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for CNO Financial’s bottom line for the to-be-reported quarter suggests a 51.8% year-over-year jump to 85 cents per share. The estimate remained stable over the past week. The consensus mark for CNO’s revenues is pegged at $934.1 million.
Everest Group, Ltd. (EG - Free Report) has an Earnings ESP of +1.18% and is a Zacks #3 Ranked player.
The Zacks Consensus Estimate for Everest’s bottom line for the to-be-reported quarter indicates a 19.8% year-over-year increase. The estimate remained stable over the past week. Furthermore, EG beat earnings estimates in three of the past four quarters and missed once, with the average surprise being 24.5%.
Arch Capital Group Ltd. (ACGL - Free Report) has an Earnings ESP of +1.24% and a Zacks Rank of 3.
The Zacks Consensus Estimate for Arch Capital’s bottom line for the to-be-reported quarter is pegged at $1.94 per share, which increased by 4 cents in the past month. ACGL beat earnings estimates in all the past four quarters, with an average surprise of 35.2%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.