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MetLife (MET) Earnings Beat Estimates in Q2, Improve Y/Y
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MetLife, Inc.’s (MET - Free Report) second-quarter 2017 earnings of $1.30 per share beat the Zacks Consensus Estimate by 1.56% and soared 57% year over year.
Earnings improved on the back of volume growth, continued expense discipline and higher fees from improved equity markets.
The company continues to deliver strong results globally.
The company generated operating revenues of $17.6 billion, up 3% year over year on 4% higher premiums, fees & other revenues and 1% increase in net investment income. Revenues surpassed the Zacks Consensus Estimate of $17.1 billion.
Total operating expenses dipped 0.9% year over year to $15.5 billion.
Operating earnings in this segment increased 13% year over year to $499 million, led by favorable underwriting results and volume growth. Operating premiums, fees & other revenues increased 13% to $6.3 billion.
Asia
Operating earnings were up 20% (or 21% on a constant currency basis) year over year to $310 million on volume growth and a reinsurance recovery in Australia, partly offset by higher expenses. Operating premiums, fees & other revenues in Asia decreased 1% (up 1% on a constant currency basis) to $2 billion.
Latin America
Operating earnings were $154 million, up 12% (14% on a constant currency basis) year over year. Earnings improved due to volume growth, higher investment margins and lower taxes. Operating premiums, fees & other revenues were $928 million, up 2% on reported as well as on constant currency basis due to non-renewal of a low-margin large contract.
EMEA
Operating earnings from EMEA increased 13% (or 24% on constant currency basis) year over year to $72 million primarily led by favorable expense margin and better underwriting. Operating premiums, fees & other revenues were $625 million, declined 1% (up 3% on a constant currency basis) from the prior-year period driven by growth in Turkey as well as in employee benefits in the United Kingdom.
MetLife Holdings
Operating earnings from MetLife Holdings came in at $235 million against the loss of $33 million in the prior-year quarter. Operating premiums, fees & other revenues were $1.4 billion, down 17% primarily due to the sale of MetLife Premier Client Group.
Corporate & Other
Corporate & other incurred an operating loss of $146 million compared to an operating loss of $243 million in the prior-year quarter. The loss incurred in the quarter was comparatively less due to lower tax rate and flattering investment margins.
Brighthouse Financial
Brighthouse Financial reported operating earnings of $283 million, down 5% year over year. The decline stemmed from lower universal life with secondary guarantees (ULSG) earnings, lower investment income and higher expenses. Operating premiums, fees & other revenues decreased 13% year over year to $1.3 billion, due to lower annuity and life insurance sales.
Investment & Financial Update
Variable investment income decreased to $279 million from $285 million in the year-ago quarter driven by the strong performance of private equity and hedge fund investments.
Book Value per share decreased 4.1% year over year to $51.03 per share.
Among other players from the insurance industry that have reported their second-quarter earnings so far, the bottom line of Brown & Brown, Inc. (BRO - Free Report) and Fidelity National Financial, Inc. (FNF - Free Report) have topped their respective Zacks Consensus Estimates, while The Progressive Corporation (PGR - Free Report) lagged the same.
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MetLife (MET) Earnings Beat Estimates in Q2, Improve Y/Y
MetLife, Inc.’s (MET - Free Report) second-quarter 2017 earnings of $1.30 per share beat the Zacks Consensus Estimate by 1.56% and soared 57% year over year.
Earnings improved on the back of volume growth, continued expense discipline and higher fees from improved equity markets.
The company continues to deliver strong results globally.
The company generated operating revenues of $17.6 billion, up 3% year over year on 4% higher premiums, fees & other revenues and 1% increase in net investment income. Revenues surpassed the Zacks Consensus Estimate of $17.1 billion.
Total operating expenses dipped 0.9% year over year to $15.5 billion.
MetLife, Inc. Price, Consensus and EPS Surprise
MetLife, Inc. Price, Consensus and EPS Surprise | MetLife, Inc. Quote
Segment Details
U.S.
Operating earnings in this segment increased 13% year over year to $499 million, led by favorable underwriting results and volume growth. Operating premiums, fees & other revenues increased 13% to $6.3 billion.
Asia
Operating earnings were up 20% (or 21% on a constant currency basis) year over year to $310 million on volume growth and a reinsurance recovery in Australia, partly offset by higher expenses. Operating premiums, fees & other revenues in Asia decreased 1% (up 1% on a constant currency basis) to $2 billion.
Latin America
Operating earnings were $154 million, up 12% (14% on a constant currency basis) year over year. Earnings improved due to volume growth, higher investment margins and lower taxes. Operating premiums, fees & other revenues were $928 million, up 2% on reported as well as on constant currency basis due to non-renewal of a low-margin large contract.
EMEA
Operating earnings from EMEA increased 13% (or 24% on constant currency basis) year over year to $72 million primarily led by favorable expense margin and better underwriting. Operating premiums, fees & other revenues were $625 million, declined 1% (up 3% on a constant currency basis) from the prior-year period driven by growth in Turkey as well as in employee benefits in the United Kingdom.
MetLife Holdings
Operating earnings from MetLife Holdings came in at $235 million against the loss of $33 million in the prior-year quarter. Operating premiums, fees & other revenues were $1.4 billion, down 17% primarily due to the sale of MetLife Premier Client Group.
Corporate & Other
Corporate & other incurred an operating loss of $146 million compared to an operating loss of $243 million in the prior-year quarter. The loss incurred in the quarter was comparatively less due to lower tax rate and flattering investment margins.
Brighthouse Financial
Brighthouse Financial reported operating earnings of $283 million, down 5% year over year. The decline stemmed from lower universal life with secondary guarantees (ULSG) earnings, lower investment income and higher expenses. Operating premiums, fees & other revenues decreased 13% year over year to $1.3 billion, due to lower annuity and life insurance sales.
Investment & Financial Update
Variable investment income decreased to $279 million from $285 million in the year-ago quarter driven by the strong performance of private equity and hedge fund investments.
Book Value per share decreased 4.1% year over year to $51.03 per share.
Zacks Rank
Lincoln National carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
Performance of Other Insurers
Among other players from the insurance industry that have reported their second-quarter earnings so far, the bottom line of Brown & Brown, Inc. (BRO - Free Report) and Fidelity National Financial, Inc. (FNF - Free Report) have topped their respective Zacks Consensus Estimates, while The Progressive Corporation (PGR - Free Report) lagged the same.
More Stock News: Tech Opportunity Worth $386 Billion in 2017
From driverless cars to artificial intelligence, we've seen an unsurpassed growth of high-tech products in recent months. Yesterday's science-fiction is becoming today's reality. Despite all the innovation, there is a single component no tech company can survive without. Demand for this critical device will reach $387 billion this year alone, and it's likely to grow even faster in the future.
Zacks has released a brand-new Special Report to help you take advantage of this exciting investment opportunity. Most importantly, it reveals 4 stocks with massive profit potential. See these stocks now>>