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Primerica Q3 Earnings Beat on Strong Term Life Insurance Sales
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Primerica, Inc. (PRI - Free Report) shares gained 3.4% since it reported third-quarter earnings on Nov. 6, 2024. The quarterly results benefited from strong Term Life sales and Investment and Savings Product sales. Growth in policies issued and equity market appreciation also favored the results. Higher benefits and expenses partially offset the positives.
Primerica reported a third-quarter 2024 adjusted earnings of $5.68 per share, which beat the Zacks Consensus Estimate by 18.8%. The bottom line jumped 32.7% from the prior-year quarter.
The top line increased 8% year over year to $770.1 million. The figure beat the consensus mark by 4.1%.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Primerica reported net premiums of $439.8 million in the third quarter, up 4.6% from the year-ago level. The metric beat the consensus mark by 2.3%. Net investment income rose 18.4% year over year to $41.1 million. The metric beat the consensus mark by 10%. Commissions and fees increased 19.5% from the year-ago period to $271.9 million. It beat the consensus mark by 6.2%.
Total benefits and expenses increased 5.8% in the third quarter to $519.6 million due to higher benefits and claims, sales commissions and other operating expenses.
Adjusted net operating income jumped 21% year over year to $193.2 million in the third quarter. In September-end, PRI’s total independent life-licensed representatives were 148,890, which rose 7% from a year ago.
Segmental Update
Term Life Insurance: Adjusted operating revenues from the segment climbed 5% year over year to $450.3 million. Adjusted operating income before income taxes jumped 26% year over year to $178.4 million. The metric beat the consensus mark by 24.8%. The segment was supported by increased policies issued and an increase in adjusted direct premiums.
Investment and Savings Products: Adjusted operating revenues from the segment improved 22% year over year to $266.1 million. Adjusted operating income before income taxes rose 24% year over year to $79.9 million. The segment benefited from strong sales and robust equity market appreciation giving rise to average client asset values. It beat the consensus mark by 11.9%.
Corporate and Other Distributed Products: Adjusted operating revenues from the unit rose 3% year over year to $53.7 million.Adjusted operating loss before income taxes was $5.7 million. The segment suffered from a remeasurement loss, lower revenues from certain distribution products, and other operating expenses partially offset by improved net investment income.
Financial Update (as of Sept. 30, 2024)
Primerica exited the third quarter with cash and cash equivalents of $550.1 million, which declined from the 2023-end level of $594.1 million. Total assets of $14.8 billion decreased from $15 billion at 2023-end.
Surplus note was $1.33 billion at the third-quarter end, down from $1.39 billion at 2023-end.
Total shareholders’ equity of $1.9 billion decreased from the 2023-end level of $2.1 billion.
Operating cash flow in the first nine months of 2024 was recorded at $591.4 million, up from $451.5 million in the year-ago period.
Divestiture Update
On Sept. 30, 2024, the company permanently exited its senior health business by surrendering and relinquishing all rights to e-TeleQuote Insurance, Inc., with no significant ongoing involvement.
Capital Deployment
PRI bought back shares worth $129 million in the third quarter. It paid regular dividends worth $31 million in the third quarter of 2024.
It approved a dividend of 90 cents per share, which will be paid on Dec. 12, to shareholders on record as of Nov. 21, 2024.
2024 Guidance
PRI expects growth of 3% in full-year life sales in 2024. The benefits and Claims ratio for the Term Life insurance segment is expected to be around 58% in the fourth quarter of 2024. Operating margin is expected to be near 22% in the fourth quarter.
Investment and Savings Product sales are expected to be between 22% and 25% in 2024.
The company anticipates growth of around 9% in insurance and other operating expenses in 2024.
Of the insurance industry players that have reported third-quarter 2024 results so far, the bottom-line results of Marsh & McLennan Companies, Inc. (MMC - Free Report) , The Hartford Financial Services Group, Inc. (HIG - Free Report) and AMERISAFE, Inc. (AMSF - Free Report) beat the Zacks Consensus Estimate.
Marsh & McLennan reported third-quarter 2024 adjusted earnings per share of $1.63, which beat the Zacks Consensus Estimate by 1.2%. The bottom line increased 3.8% year over year. Consolidated revenues rose 6% year over year to $5.7 billion. The figure also improved 5% on an underlying basis. The top line, however, fell 0.2% short of the consensus mark.
Hartford Financial 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%.
AMERISAFE reported third-quarter adjusted earnings per share of 58 cents, which beat the Zacks Consensus Estimate by 3.6%. However, the bottom line dipped 4.9% year over year.
Operating revenues declined 0.2% year over year to $74.7 million. The top line missed the consensus mark by a whisker.
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Primerica Q3 Earnings Beat on Strong Term Life Insurance Sales
Primerica, Inc. (PRI - Free Report) shares gained 3.4% since it reported third-quarter earnings on Nov. 6, 2024. The quarterly results benefited from strong Term Life sales and Investment and Savings Product sales. Growth in policies issued and equity market appreciation also favored the results. Higher benefits and expenses partially offset the positives.
Primerica reported a third-quarter 2024 adjusted earnings of $5.68 per share, which beat the Zacks Consensus Estimate by 18.8%. The bottom line jumped 32.7% from the prior-year quarter.
The top line increased 8% year over year to $770.1 million. The figure beat the consensus mark by 4.1%.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Primerica, Inc. Price, Consensus and EPS Surprise
Primerica, Inc. price-consensus-eps-surprise-chart | Primerica, Inc. Quote
Q3 Operational Update
Primerica reported net premiums of $439.8 million in the third quarter, up 4.6% from the year-ago level. The metric beat the consensus mark by 2.3%. Net investment income rose 18.4% year over year to $41.1 million. The metric beat the consensus mark by 10%. Commissions and fees increased 19.5% from the year-ago period to $271.9 million. It beat the consensus mark by 6.2%.
Total benefits and expenses increased 5.8% in the third quarter to $519.6 million due to higher benefits and claims, sales commissions and other operating expenses.
Adjusted net operating income jumped 21% year over year to $193.2 million in the third quarter. In September-end, PRI’s total independent life-licensed representatives were 148,890, which rose 7% from a year ago.
Segmental Update
Term Life Insurance: Adjusted operating revenues from the segment climbed 5% year over year to $450.3 million. Adjusted operating income before income taxes jumped 26% year over year to $178.4 million. The metric beat the consensus mark by 24.8%. The segment was supported by increased policies issued and an increase in adjusted direct premiums.
Investment and Savings Products: Adjusted operating revenues from the segment improved 22% year over year to $266.1 million. Adjusted operating income before income taxes rose 24% year over year to $79.9 million. The segment benefited from strong sales and robust equity market appreciation giving rise to average client asset values. It beat the consensus mark by 11.9%.
Corporate and Other Distributed Products: Adjusted operating revenues from the unit rose 3% year over year to $53.7 million.Adjusted operating loss before income taxes was $5.7 million. The segment suffered from a remeasurement loss, lower revenues from certain distribution products, and other operating expenses partially offset by improved net investment income.
Financial Update (as of Sept. 30, 2024)
Primerica exited the third quarter with cash and cash equivalents of $550.1 million, which declined from the 2023-end level of $594.1 million. Total assets of $14.8 billion decreased from $15 billion at 2023-end.
Surplus note was $1.33 billion at the third-quarter end, down from $1.39 billion at 2023-end.
Total shareholders’ equity of $1.9 billion decreased from the 2023-end level of $2.1 billion.
Operating cash flow in the first nine months of 2024 was recorded at $591.4 million, up from $451.5 million in the year-ago period.
Divestiture Update
On Sept. 30, 2024, the company permanently exited its senior health business by surrendering and relinquishing all rights to e-TeleQuote Insurance, Inc., with no significant ongoing involvement.
Capital Deployment
PRI bought back shares worth $129 million in the third quarter. It paid regular dividends worth $31 million in the third quarter of 2024.
It approved a dividend of 90 cents per share, which will be paid on Dec. 12, to shareholders on record as of Nov. 21, 2024.
2024 Guidance
PRI expects growth of 3% in full-year life sales in 2024. The benefits and Claims ratio for the Term Life insurance segment is expected to be around 58% in the fourth quarter of 2024. Operating margin is expected to be near 22% in the fourth quarter.
Investment and Savings Product sales are expected to be between 22% and 25% in 2024.
The company anticipates growth of around 9% in insurance and other operating expenses in 2024.
PRI’s Zacks Rank
Primerica currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performances of Other Insurers
Of the insurance industry players that have reported third-quarter 2024 results so far, the bottom-line results of Marsh & McLennan Companies, Inc. (MMC - Free Report) , The Hartford Financial Services Group, Inc. (HIG - Free Report) and AMERISAFE, Inc. (AMSF - Free Report) beat the Zacks Consensus Estimate.
Marsh & McLennan reported third-quarter 2024 adjusted earnings per share of $1.63, which beat the Zacks Consensus Estimate by 1.2%. The bottom line increased 3.8% year over year. Consolidated revenues rose 6% year over year to $5.7 billion. The figure also improved 5% on an underlying basis. The top line, however, fell 0.2% short of the consensus mark.
Hartford Financial 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%.
AMERISAFE reported third-quarter adjusted earnings per share of 58 cents, which beat the Zacks Consensus Estimate by 3.6%. However, the bottom line dipped 4.9% year over year.
Operating revenues declined 0.2% year over year to $74.7 million. The top line missed the consensus mark by a whisker.