We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Assurant Q3 Earnings Beat on Solid Global Housing Growth, View Raised
Read MoreHide Full Article
Assurant, Inc. (AIZ - Free Report) reported third-quarter 2024 net operating income of $3.00 per share, which beat the Zacks Consensus Estimate by 20%. However, the bottom line declined 30.7% year over year.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
The quarterly results reflected solid performance at Global Housing with growing revenues and expense discipline. Global Lifestyle performed in line with expectations, as AIZ prioritized strategic investments for growth in new and expanded Connected Living partnerships and saw further signs of stabilization within Global Automotive.
Total revenues increased 7.6% year over year to nearly $3 billion, driven by higher net earned premiums, fees and other income and net investment income. The top line beat the Zacks Consensus Estimate by 2.6%.
Net earned premiums, fees and other income increased 7% year over year to $2.9 billion, driven by growth across both segments. Our estimate was $2.8 billion.
Net investment income was down 10.9% year over year to $129.7 million. Our estimate was $130.7 million. The Zacks Consensus Estimate was pegged at $127 million.
Total benefits, loss and expenses increased 2.2% to $2.8 billion, mainly due to higher policyholders benefit. Our estimate was $2.5 billion.
Adjusted EBITDA, excluding reportable catastrophes, increased 31.6% to $ 246.9 million. Our estimate was $397.7 million.
Segmental Performance
Revenues at Global Housing increased 9.7% year over year to $635.5 million, primarily driven by higher net earned premiums and net investment income. The figure was higher than our estimate of $577 million. The Zacks Consensus Estimate was $621 million.
Net earned premiums, fees and other income increased 9% year over year, driven by Homeowners’ top-line growth, including growth in policies in force and higher average premiums within lender-placed.
Adjusted EBITDA, excluding catastrophes, increased 10.2% year over year to $229.2 million on continued top-line growth within Homeowners, including higher policies in force from new lender-placed programs and portfolios. The figure was higher than our estimate of $167.7 million. The Zacks Consensus Estimate was $169 million.
Revenues at Global Lifestyle declined 3% year over year to $2.3 billion, owing to a drop in net investment income. Revenues matched the Zacks Consensus Estimate and our estimate.
Adjusted EBITDA, excluding catastrophes, of $184.3 million decreased 10% year over year, attributable to unfavorable foreign exchange and modestly lower results within Global Automotive, where elevated losses within select ancillary products. The figure was lower than our estimate of $258 million. The Zacks Consensus Estimate was pegged at $229 million.
Adjusted EBITDA loss at Corporate & Other was $29.8 million, narrower than the year-ago quarter’s adjusted EBITDA loss of $29.9 million. The narrower loss was attributable to higher net investment income from higher asset levels and yields. The Zacks Consensus Estimate was pegged at a loss of $27 million.
Financial Position
Liquidity was $638 million as of Sept. 30, 2024, which was $411 million higher than the company’s current targeted minimum level of $225 million.
Total assets increased 5.1% to $35.3 billion as of Sept. 30, 2024, from the end of 2023.
Total shareholders’ equity came in at $5.3 billion, up 9.3% year over year.
Debt-to-total capital ratio of 28.4 improved 180 bps from the 2023 end level.
Share Repurchase and Dividend Update
In the third quarter, Assurant returned $138 million to shareholders, comprising $100 million in buybacks and $38 million in dividends. Through Nov. 2, the insurer bought back another $20 million worth of shares and now has $475 million remaining under the current repurchase authorization.
2024 Guidance Raised
Assurant expects adjusted EBITDA to increase in low double digits, led by strong growth in Global Housing and modest growth in Global Lifestyle. It expected the same to increase in high single digits earlier.
Global Housing adjusted EBITDA, excluding reportable catastrophes, is expected to increase and deliver strong growth, mainly driven by top-line growth in Homeowners, favorable non-catastrophe loss experience, benefits from expense leverage and lower catastrophe reinsurance premiums.
Global Lifestyle adjusted EBITDA is expected to increase modestly. The company continues to expect organic growth and improved profitability in Connected Living programs, partially offset by investments to support growth, including new client and program implementation expenses. It now expects Global Automotive to be down due to continued loss pressure from inflation and elevated losses in select ancillary products.
Corporate and Other adjusted EBITDA loss is expected to approximate $115 million.
The company now expects a lower effective tax rate of approximately 18% to 20%. It continues to expect depreciation expense of approximately $135 million, interest expense of approximately $107 million and amortization of purchased intangible assets of approximately $70 million.
Adjusted earnings per share are expected to grow in mid- to high-teens, excluding reportable catastrophes. It earlier expected adjusted earnings per share, excluding reportable catastrophes, to grow in low double digits.
The insurer expects share repurchases worth $300 million, reflecting a strong capital position and a comprehensive catastrophe reinsurance program.
MetLife, Inc. (MET - Free Report) reported third-quarter 2024 adjusted operating earnings of $1.93 per share, which missed the Zacks Consensus Estimate by 10.7%. The bottom line declined 1% year over year. Adjusted operating revenues of $17.6 billion decreased 3.4% year over year. The top line missed the consensus mark by 4.7%.
Earlier, management estimated a variable investment income of $1.5 billion for 2024. Corporate & Other adjusted losses are anticipated between $750 million and $850 million. The effective tax rate is projected to be in the range of 24-26%. MetLife Holdings segment’s adjusted PFOs are expected to witness a year-over-year decline of 13-15%. The unit’s adjusted earnings are forecast to be $700-$900 million.
Adjusted earnings in the Asia segment are anticipated to grow 20%. Adjusted earnings in the EMEA unit are likely to be in the range of $60-$65 million for the remaining quarters of 2024.
Prudential Financial, Inc. (PRU - Free Report) reported third-quarter 2024 adjusted operating income of $3.48 per share, which beat the Zacks Consensus Estimate by 0.2%. However, the bottom line decreased 3.8% year over year. Total revenues of $19.5 billion surged 94% year over year and beat the Zacks Consensus Estimate by 33.7%. The increase in revenues was due to higher premiums, policy charges and fee income and net investment income.
The Hartford Financial Services Group, Inc. (HIG - Free Report) reported third-quarter 2024 adjusted operating earnings of $2.53 per share, which beat the Zacks Consensus Estimate by 1.6%. The bottom line increased 10.5% year over year. Operating revenues of HIG amounted to $4.7 billion, which improved 10.9% year over year in the quarter under review. The top line beat the consensus mark by 1.1%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Assurant Q3 Earnings Beat on Solid Global Housing Growth, View Raised
Assurant, Inc. (AIZ - Free Report) reported third-quarter 2024 net operating income of $3.00 per share, which beat the Zacks Consensus Estimate by 20%. However, the bottom line declined 30.7% year over year.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
The quarterly results reflected solid performance at Global Housing with growing revenues and expense discipline. Global Lifestyle performed in line with expectations, as AIZ prioritized strategic investments for growth in new and expanded Connected Living partnerships and saw further signs of stabilization within Global Automotive.
Total revenues increased 7.6% year over year to nearly $3 billion, driven by higher net earned premiums, fees and other income and net investment income. The top line beat the Zacks Consensus Estimate by 2.6%.
Assurant, Inc. Price, Consensus and EPS Surprise
Assurant, Inc. price-consensus-eps-surprise-chart | Assurant, Inc. Quote
Net earned premiums, fees and other income increased 7% year over year to $2.9 billion, driven by growth across both segments. Our estimate was $2.8 billion.
Net investment income was down 10.9% year over year to $129.7 million. Our estimate was $130.7 million. The Zacks Consensus Estimate was pegged at $127 million.
Total benefits, loss and expenses increased 2.2% to $2.8 billion, mainly due to higher policyholders benefit. Our estimate was $2.5 billion.
Adjusted EBITDA, excluding reportable catastrophes, increased 31.6% to $ 246.9 million. Our estimate was $397.7 million.
Segmental Performance
Revenues at Global Housing increased 9.7% year over year to $635.5 million, primarily driven by higher net earned premiums and net investment income. The figure was higher than our estimate of $577 million. The Zacks Consensus Estimate was $621 million.
Net earned premiums, fees and other income increased 9% year over year, driven by Homeowners’ top-line growth, including growth in policies in force and higher average premiums within lender-placed.
Adjusted EBITDA, excluding catastrophes, increased 10.2% year over year to $229.2 million on continued top-line growth within Homeowners, including higher policies in force from new lender-placed programs and portfolios. The figure was higher than our estimate of $167.7 million. The Zacks Consensus Estimate was $169 million.
Revenues at Global Lifestyle declined 3% year over year to $2.3 billion, owing to a drop in net investment income. Revenues matched the Zacks Consensus Estimate and our estimate.
Adjusted EBITDA, excluding catastrophes, of $184.3 million decreased 10% year over year, attributable to unfavorable foreign exchange and modestly lower results within Global Automotive, where elevated losses within select ancillary products. The figure was lower than our estimate of $258 million. The Zacks Consensus Estimate was pegged at $229 million.
Adjusted EBITDA loss at Corporate & Other was $29.8 million, narrower than the year-ago quarter’s adjusted EBITDA loss of $29.9 million. The narrower loss was attributable to higher net investment income from higher asset levels and yields. The Zacks Consensus Estimate was pegged at a loss of $27 million.
Financial Position
Liquidity was $638 million as of Sept. 30, 2024, which was $411 million higher than the company’s current targeted minimum level of $225 million.
Total assets increased 5.1% to $35.3 billion as of Sept. 30, 2024, from the end of 2023.
Total shareholders’ equity came in at $5.3 billion, up 9.3% year over year.
Debt-to-total capital ratio of 28.4 improved 180 bps from the 2023 end level.
Share Repurchase and Dividend Update
In the third quarter, Assurant returned $138 million to shareholders, comprising $100 million in buybacks and $38 million in dividends. Through Nov. 2, the insurer bought back another $20 million worth of shares and now has $475 million remaining under the current repurchase authorization.
2024 Guidance Raised
Assurant expects adjusted EBITDA to increase in low double digits, led by strong growth in Global Housing and modest growth in Global Lifestyle. It expected the same to increase in high single digits earlier.
Global Housing adjusted EBITDA, excluding reportable catastrophes, is expected to increase and deliver strong growth, mainly driven by top-line growth in Homeowners, favorable non-catastrophe loss experience, benefits from expense leverage and lower catastrophe reinsurance premiums.
Global Lifestyle adjusted EBITDA is expected to increase modestly. The company continues to expect organic growth and improved profitability in Connected Living programs, partially offset by investments to support growth, including new client and program implementation expenses. It now expects Global Automotive to be down due to continued loss pressure from inflation and elevated losses in select ancillary products.
Corporate and Other adjusted EBITDA loss is expected to approximate $115 million.
The company now expects a lower effective tax rate of approximately 18% to 20%. It continues to expect depreciation expense of approximately $135 million, interest expense of approximately $107 million and amortization of purchased intangible assets of approximately $70 million.
Adjusted earnings per share are expected to grow in mid- to high-teens, excluding reportable catastrophes. It earlier expected adjusted earnings per share, excluding reportable catastrophes, to grow in low double digits.
The insurer expects share repurchases worth $300 million, reflecting a strong capital position and a comprehensive catastrophe reinsurance program.
Zacks Rank
AIZ currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Multiline Insurers
MetLife, Inc. (MET - Free Report) reported third-quarter 2024 adjusted operating earnings of $1.93 per share, which missed the Zacks Consensus Estimate by 10.7%. The bottom line declined 1% year over year. Adjusted operating revenues of $17.6 billion decreased 3.4% year over year. The top line missed the consensus mark by 4.7%.
Earlier, management estimated a variable investment income of $1.5 billion for 2024. Corporate & Other adjusted losses are anticipated between $750 million and $850 million. The effective tax rate is projected to be in the range of 24-26%.
MetLife Holdings segment’s adjusted PFOs are expected to witness a year-over-year decline of 13-15%. The unit’s adjusted earnings are forecast to be $700-$900 million.
Adjusted earnings in the Asia segment are anticipated to grow 20%. Adjusted earnings in the EMEA unit are likely to be in the range of $60-$65 million for the remaining quarters of 2024.
Prudential Financial, Inc. (PRU - Free Report) reported third-quarter 2024 adjusted operating income of $3.48 per share, which beat the Zacks Consensus Estimate by 0.2%. However, the bottom line decreased 3.8% year over year. Total revenues of $19.5 billion surged 94% year over year and beat the Zacks Consensus Estimate by 33.7%. The increase in revenues was due to higher premiums, policy charges and fee income and net investment income.
The Hartford Financial Services Group, Inc. (HIG - Free Report) reported third-quarter 2024 adjusted operating earnings of $2.53 per share, which beat the Zacks Consensus Estimate by 1.6%. The bottom line increased 10.5% year over year.
Operating revenues of HIG amounted to $4.7 billion, which improved 10.9% year over year in the quarter under review. The top line beat the consensus mark by 1.1%.