On Nov 21, 2016, the stock of Lincoln National Corp. (LNC - Free Report) climbed to a 52-week high of $63.39. The upside is believed to have been driven by a profitable third quarter reported last month as well as enhanced shareholder-friendly moves.
Over the past 52-weeks, the stock has gained 14% compared with a rise of just 5.3% in the S&P 500 index over the same period.
Investors favorably viewed the company’s third-quarter results. Earnings of $1.83 per share surpassed the Zacks Consensus Estimate by 13% and increased 10.2% year over year. Also, revenues of $3.5 billion beat the Zacks Consensus Estimate of $3.4 billion by 3%.
The quality of earnings was strong as evident by an improvement in the underlying margins, despite macro headwinds that dampened growth at the life insurance industry.
Investors appreciate the efforts taken by the company to successfully respond to macro challenges with short-term actions. These actions, which include disciplined expense and capital management, have helped the company to sustain its earnings growth.
The company’s capital management via consistent share buyback and dividend payment also must have helped it to gain investors’ favor. Earlier this month, the company announced a 16% increase in its quarterly dividend to 29 cents per share. Also, the company deployed 76% (in the first nine months of 2016) of its operating earnings toward buybacks and dividends, crossing its annual target of 50% to 55%.
Lincoln National carries a Zacks Rank #2 (Buy).
Investors may also consider players like Alleghany Corp. (Y - Free Report) , Arch Capital Group Limited (ACGL - Free Report) and First American Financial Corporation (FAF - Free Report) . Each of these stocks carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Alleghany delivered positive surprises in three of the last four quarters, with an average beat of 20.52%.
Arch Capital beat expectations in each of the last four quarters, with an average beat of 9.27%.
First American Financial Corporation delivered positive surprises in each of the last four quarters, with an average beat of 62.8%.
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