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Sun Life Financial (SLF) Q3 Earnings Beat; Dividend Raised

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Sun Life Financial Inc.’s (SLF - Free Report) third-quarter 2016 operating net income of $575.1 million (C$750 million) surged 57% year over year. Also, operating net earnings per share of 79 cents beat the Zacks Consensus Estimate by 11.3%.

Both wealth as well as life and health sales improved in the quarter. Each of the segments delivered improved operating earnings in the quarter. The life insurer increased ownership in its Asian joint ventures and remains on track with the integration of U.S. employee benefits acquisition. It also expanded its Canadian wealth and asset management businesses in the quarter.

Total premiums and deposits were $29.3 billion (C$40.2 billion), up nearly 13% year over year.

Adjusted revenues came in at $5.7 billion (C$7.4 billion), up 23% year over year. Higher premiums and fee income drove the upside.
 
Total company life and health sales were $506.8 million (C$661 million), up 24.7% year over year.
 
Total company wealth sales were $27 billion (C$35.2 billion), up 28.5% year over year.

Segment Results
 

SLF Canada reported operating net income of $136.5 million (C$178 million), up 30% year over year.

SLF U.S. operating net income of $205 million surged from $49 million earned in the year-ago quarter.

SLF Asset Management reported operating net income of $144.2 million (C$188 million), up 6.8% year over year.
 
SLF Asia reported operating income of $68.2 million (C$89 million), up 15.9% year over year.
 
Financial Update  
 
Assets under management increased 5.1% year over year to $693.4 billion (C$908 billion) as of Sep 30, 2016.
 
Sun Life Assurance's Minimum Continuing Capital and Surplus Requirements (MCCSR) ratio was 221% as of Sep 30, 2016 compared with 229% as of Sep 30, 2015.
 
Sun Life Financial’s operating return on equity was 15.7% as against 10.5% in the year-ago quarter. Underlying ROE of 13.3% deteriorated from 11.6% in the year-ago quarter.

Dividend Update

The board of directors of Sun Life Financial approved a1.5% increase to its dividend. The new dividend of 42 cents per share will be paid on Dec 30, to shareholders on record as of Nov 30, 2016.

Zacks Rank

Sun Life carries a Zacks Rank #4 (Sell).

SUN LIFE FINL Price, Consensus and EPS Surprise

SUN LIFE FINL Price, Consensus and EPS Surprise | SUN LIFE FINL Quote

Performance of Other Life Insurers

Earnings of Torchmark Corp. (TMK - Free Report) and Reinsurance Group of America Inc. (RGA - Free Report) beat their Zacks Consensus Estimate, while that of Genworth Financial Inc. (GNW - Free Report) missed the same in the third quarter. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

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