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Why Is Sun Life Financial (SLF) Down 2.9% Since the Last Earnings Report?
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It has been about a month since the last earnings report for Sun Life Financial Inc. (SLF - Free Report) . Shares have lost about 2.9% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Sun Life Financial Q1 Earnings Decline, Dividend Raised
Sun Life Financial Inc.’s first-quarter 2017 underlying net income of $423 million (C$573 million) declined 1.5% year over year.
Sun Life’s Canadian and Asia operations delivered improved results. However, the U.S. business remained soft. MFS too experienced net outflows. The company also witnessed favorable mortality experience in SLF Canada and SLF U.K. as well as gains from investing activities on insurance contract liabilities. However, unfavorable mortality experience in SLF U.S. weighed on the upside.
In the quarter, Sun Life witnessed strong revenue growth with insurance sales increasing 58% and wealth sales rising 13%.
Total premiums and deposits were $31.9 billion (C$42.3 billion), up 11.8% year over year.
Adjusted revenues came in at $5.5 billion (C$7.3 billion), up 7.7% year over year. Higher premiums and fee income in SLF U.S. and SLF Asia drove the upside.
Segment Results
SLF Canada’s underlying net income increased 5% year over year to $173 million (C$229 million). The company recorded positive mortality experience in individual wealth business and GRS alongside investment activity on insurance contract liabilities. Higher expenses, including investment in wealth businesses, partially offset the improvement.
SLF U.S. underlying net income was $77 million, down 30.6% from the year-ago quarter. The company recorded unfavorable mortality experience in In-force Management and Group Benefits, unfavorable policyholder behavior in International and In-force Management. However, favorable morbidity experience in disability and dental limited the downside.
SLF Asset Management’s underlying operating net income of $132.8 million (C$176 million) increased 7.3% year over year.
SLF Asia reported underlying income of $59.7 million (C$79 million), up 16.2% year over year. Business growth, partially offset by unfavorable impact of foreign exchange, favored the quarterly performance.
Financial Update
Global assets under management was $695.6 billion (C$927 billion), up 2.6% from the 2016-end level.
Sun Life Assurance's Minimum Continuing Capital and Surplus Requirements (MCCSR) ratio was 249% as of Mar 31, 2017 compared with 226% as of Dec 31, 2016.
Sun Life Financial reported operating return on equity of 11% in the first quarter of 2017 as against 11.5% in the prior-year quarter. Underlying ROE of 11.5% deteriorated from 12.4% in the year-ago quarter.
Dividend Update
The board of directors of Sun Life Financial approved dividend of $0.435 per share. This represents a 4% increase over the prior payout. The dividend will be paid on Jun 30, to shareholders on record as of May 31, 2017.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
At this time, the stock has a poor Growth Score of 'F', a grade with the same score on the momentum front. However, the stock was allocated a grade of 'B' on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'D'. If you aren't focused on one strategy, this score is the one you should be interested in.
The company's stock is suitable solely for value based on our styles scores.
Outlook
The stock has a Zacks Rank #4 (Sell). We are expecting a below average return from the stock in the next few months.
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Why Is Sun Life Financial (SLF) Down 2.9% Since the Last Earnings Report?
It has been about a month since the last earnings report for Sun Life Financial Inc. (SLF - Free Report) . Shares have lost about 2.9% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Sun Life Financial Q1 Earnings Decline, Dividend Raised
Sun Life Financial Inc.’s first-quarter 2017 underlying net income of $423 million (C$573 million) declined 1.5% year over year.
Sun Life’s Canadian and Asia operations delivered improved results. However, the U.S. business remained soft. MFS too experienced net outflows. The company also witnessed favorable mortality experience in SLF Canada and SLF U.K. as well as gains from investing activities on insurance contract liabilities. However, unfavorable mortality experience in SLF U.S. weighed on the upside.
In the quarter, Sun Life witnessed strong revenue growth with insurance sales increasing 58% and wealth sales rising 13%.
Total premiums and deposits were $31.9 billion (C$42.3 billion), up 11.8% year over year.
Adjusted revenues came in at $5.5 billion (C$7.3 billion), up 7.7% year over year. Higher premiums and fee income in SLF U.S. and SLF Asia drove the upside.
Segment Results
SLF Canada’s underlying net income increased 5% year over year to $173 million (C$229 million). The company recorded positive mortality experience in individual wealth business and GRS alongside investment activity on insurance contract liabilities. Higher expenses, including investment in wealth businesses, partially offset the improvement.
SLF U.S. underlying net income was $77 million, down 30.6% from the year-ago quarter. The company recorded unfavorable mortality experience in In-force Management and Group Benefits, unfavorable policyholder behavior in International and In-force Management. However, favorable morbidity experience in disability and dental limited the downside.
SLF Asset Management’s underlying operating net income of $132.8 million (C$176 million) increased 7.3% year over year.
SLF Asia reported underlying income of $59.7 million (C$79 million), up 16.2% year over year. Business growth, partially offset by unfavorable impact of foreign exchange, favored the quarterly performance.
Financial Update
Global assets under management was $695.6 billion (C$927 billion), up 2.6% from the 2016-end level.
Sun Life Assurance's Minimum Continuing Capital and Surplus Requirements (MCCSR) ratio was 249% as of Mar 31, 2017 compared with 226% as of Dec 31, 2016.
Sun Life Financial reported operating return on equity of 11% in the first quarter of 2017 as against 11.5% in the prior-year quarter. Underlying ROE of 11.5% deteriorated from 12.4% in the year-ago quarter.
Dividend Update
The board of directors of Sun Life Financial approved dividend of $0.435 per share. This represents a 4% increase over the prior payout. The dividend will be paid on Jun 30, to shareholders on record as of May 31, 2017.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
Sun Life Financial Inc. Price and Consensus
Sun Life Financial Inc. Price and Consensus | Sun Life Financial Inc. Quote
VGM Scores
At this time, the stock has a poor Growth Score of 'F', a grade with the same score on the momentum front. However, the stock was allocated a grade of 'B' on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'D'. If you aren't focused on one strategy, this score is the one you should be interested in.
The company's stock is suitable solely for value based on our styles scores.
Outlook
The stock has a Zacks Rank #4 (Sell). We are expecting a below average return from the stock in the next few months.