Sun Life Financial Inc. (SLF Quick QuoteSLF - Free Report) delivered fourth-quarter 2023 underlying net income of $1.23 per share, which beat the Zacks Consensus Estimate by 5.1%. However, the bottom line decreased 1.6% year over year.  Underlying net income was $722 million (C$983 million), which increased 10% year over year.

Revenues of $13.7 billion increased 51.5% on a year-over-year basis.

Wealth sales & asset management gross flows of $33.7 billion (C$45.8 billion) increased 5.7% year over year. Group - Health & Protection sales of $1.1 billion (C$1.5 billion) improved 8.5% year over year. Individual - Protection sales of $519.6 million (C$707 million) jumped 42% year over year.

New business contractual service margin (CSM) was $280 million (C$381 million), up 51% year over year.

Segment Results

SLF Canada’s underlying net income increased 32% year over year to $257.2 million (C$350 million). Canada witnessed solid results in Wealth & Asset Management, Group - Health & Protection and Individual - Protection.

Wealth sales & asset management gross flows of $5 billion increased 32% year over year. Both Group - Health & Protection and Individual - Protection sales increased year over year.

SLF U.S.’ underlying net income was $187 million, which increased 8% year over year, reflecting solid results at Individual – Protection, partially offset by softer Group - Health & Protection.

U.S. group sales of $932 million improved 4% driven by medical stop-loss and commercial dental sales, partially offset by lower employee benefit sales and lower large case sales in Dental.

SLF Asset Management reported underlying net income of $243 million (C$331 million), which grew 2% year over year, driven by solid results at SLC Management. SLF Asset Management exited the reported quarter with $766 billion (C$1,016 billion) of AUM, consisting of $599 billion in MFS and $168 billion (C$223 billion) in SLC Management.

SLF Asia reported underlying net income of $105 million (C$143 million), which grew 6% year over year, driven by business growth reflecting good sales momentum at Individual - Protection.

Individual sales of $536 million increased 49% year over year. Wealth sales & asset management gross flows of $2 billion improved 12% year over year. New business CSM of $223 million increased 82.8% year over year, primarily driven by sales in Hong Kong and High Net Worth.

Financial Update  

Global assets under management were $970.47 billion (C$1,400 billion), up 6.1% year over year.

Sun Life Assurance’s Life Insurance Capital Adequacy Test (LICAT) ratio was 141% as of Dec 31, 2023, up 200 basis points (bps) from Jan 1, 2023, level.

The LICAT ratio for Sun Life (including cash and other liquid assets) was 149%, which expanded 700 bps from Jan 1, 2023, level.

Sun Life’s return on equity was 14.7% in 2023, which expanded 20 bps year over year. The underlying return on equity of 17.8% expanded 80 bps year over year. The leverage ratio of 21.8% contracted 190 bps from Jan 1, 2023, level.

Dividend Update

The company’s board of directors approved a quarterly dividend of 78 cents per share. The amount will be paid out on Mar 28, 2024, to shareholders of record at the close of business on Feb 28.

Zacks Rank

Sun Life currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Insurers

Reinsurance Group of America (RGA Quick QuoteRGA - Free Report) reported fourth-quarter 2023 adjusted operating earnings of $4.73 per share, which beat the Zacks Consensus Estimate by 7.5%. Moreover, the bottom line increased 52.8% year over year.

RGA's operating revenues of $5.2 billion beat the Zacks Consensus Estimate by 13.2%. The top line also improved 18.2% year over year due to higher net premiums. Net premiums of $4.1 billion rose 19.2% year over year.

Unum Group’s (UNM Quick QuoteUNM - Free Report) fourth-quarter 2023 operating net income of $1.79 per share missed the Zacks Consensus Estimate by 3.8%. The bottom line, however, increased 25.1% year over year.

Total operating revenues of Unum Group were $3.2 billion, up 5% year over year, driven by higher premium income, other income and improved net investment income. The top line beat the Zacks Consensus Estimate by 0.8%.

Premiums increased 5.9% year over year to $2.6 billion. Our estimate and the Zacks Consensus Estimate were both pegged at $2.5 billion for the metric.

UNM expects after-tax adjusted operating income per share to increase 7-9% in 2024.

Voya Financial (VOYA Quick QuoteVOYA - Free Report) reported fourth-quarter 2023 adjusted operating earnings of $1.97 per share, which missed the Zacks Consensus Estimate by about 1%. The bottom line decreased 9.6% year over year due to disappointing net underwriting results, partially offset by higher fee income.

Adjusted operating revenues amounted to $236 million, which decreased 11.3% year over year. The top line missed the Zacks Consensus Estimate by 22.5%.

As of Dec 31, 2023, VOYA’s assets under management, assets under administration and advisement totaled $813.5 million.