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What's in Store for Assurant (AIZ) this Earnings Season?
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Assurant, Inc. (AIZ - Free Report) is set to report fourth-quarter 2016 results on Feb 7, after the market closes. Last quarter, the company posted a negative earnings surprise of 12.28%. Let’s see how things are shaping up for this announcement.
Factors to be Considered this Quarter
Assurant is likely to record a decline in net operating income in the to-be-reported quarter owing to the anticipated fall in lender-placed insurance business, loss of the tablet program and lower contributions from legacy businesses.
Moreover, the company’s earnings from Solutions are expected to decrease due to lower-than-expected contributions from mobile business and the expected declines in legacy service contracts and domestic credit insurance.
Further, the company’s Specialty Property business is likely to report lower net earned premiums and net operating income, primarily due to the ongoing normalization of lender-placed insurance business. However, increased efficiencies and expense-saving initiatives should partially offset the downside.
However, the company is likely to have experienced growth in the fee-based capital-light businesses, which constitute 27% of segmental revenues.
With respect to the surprise trend, the company delivered positive surprises in two of the last four quarters, but with an average negative surprise of 7.92%.
Our proven model does not conclusively show that Assurant is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Assurant has an Earnings ESP of -17.50%. This is because the Most Accurate estimate is pegged at 33 cents, while the Zacks Consensus Estimate stands at 40 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Assurant carries a Zacks Rank #3. Though a favorable Zacks Rank increases the predictive power of ESP, we need a positive ESP to be confident about an earnings beat.
We caution against Sell-rated stocks (Zacks Rank #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies from the insurance industry that you may want to consider as these have the right combination of elements to post an earnings beat this quarter:
Argo Group International Holdings, Ltd. , which is set to report fourth-quarter earnings on Feb13, has an Earnings ESP of +9.52% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
American International Group, Inc. (AIG - Free Report) has an Earnings ESP of +1.64% and a Zacks Rank #3. The company is set to report fourth-quarter earnings on Feb 14.
Infinity Property and Casualty Corporation has an Earnings ESP of +8.33% and a Zacks Rank #3. The company is expected to release fourth-quarter earnings around Feb 23.
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What's in Store for Assurant (AIZ) this Earnings Season?
Assurant, Inc. (AIZ - Free Report) is set to report fourth-quarter 2016 results on Feb 7, after the market closes. Last quarter, the company posted a negative earnings surprise of 12.28%. Let’s see how things are shaping up for this announcement.
Factors to be Considered this Quarter
Assurant is likely to record a decline in net operating income in the to-be-reported quarter owing to the anticipated fall in lender-placed insurance business, loss of the tablet program and lower contributions from legacy businesses.
Moreover, the company’s earnings from Solutions are expected to decrease due to lower-than-expected contributions from mobile business and the expected declines in legacy service contracts and domestic credit insurance.
Further, the company’s Specialty Property business is likely to report lower net earned premiums and net operating income, primarily due to the ongoing normalization of lender-placed insurance business. However, increased efficiencies and expense-saving initiatives should partially offset the downside.
However, the company is likely to have experienced growth in the fee-based capital-light businesses, which constitute 27% of segmental revenues.
With respect to the surprise trend, the company delivered positive surprises in two of the last four quarters, but with an average negative surprise of 7.92%.
Assurant, Inc. Price and EPS Surprise
Assurant, Inc. Price and EPS Surprise | Assurant, Inc. Quote
Earnings Whispers
Our proven model does not conclusively show that Assurant is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Assurant has an Earnings ESP of -17.50%. This is because the Most Accurate estimate is pegged at 33 cents, while the Zacks Consensus Estimate stands at 40 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Assurant carries a Zacks Rank #3. Though a favorable Zacks Rank increases the predictive power of ESP, we need a positive ESP to be confident about an earnings beat.
We caution against Sell-rated stocks (Zacks Rank #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies from the insurance industry that you may want to consider as these have the right combination of elements to post an earnings beat this quarter:
Argo Group International Holdings, Ltd. , which is set to report fourth-quarter earnings on Feb13, has an Earnings ESP of +9.52% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
American International Group, Inc. (AIG - Free Report) has an Earnings ESP of +1.64% and a Zacks Rank #3. The company is set to report fourth-quarter earnings on Feb 14.
Infinity Property and Casualty Corporation has an Earnings ESP of +8.33% and a Zacks Rank #3. The company is expected to release fourth-quarter earnings around Feb 23.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>