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Brighthouse Financial (BHF) Surges 24.9%: Is This an Indication of Further Gains?

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Brighthouse Financial (BHF - Free Report) shares ended the last trading session 24.9% higher at $57.07. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 12% loss over the past four weeks.

The shares likely have gained on the news of Brighthouse Financial to get acquired by Sixth Street per news published in Investing.com. Early this year there were news about Brighthouse Financial is reportedly to be acquired.  Per the report, Sixth Street values Brighthouse $3.14 billion or $55 per share.

Brighthouse is poised to benefit from growth opportunities, given its expansive and compelling suite of life and annuity products and a strong market presence. It aims to become a premier player in the industry.

Brighthouse is also revamping its life insurance business to boost annuity sales. Focus on transitioning the business mix to less capital-intensive products and reinsurance programs, enhancing capital efficiencies, bodes well.  

This annuity and life insurance company is expected to post quarterly earnings of $5.09 per share in its upcoming report, which represents a year-over-year change of +27.6%. Revenues are expected to be $2.25 billion, up 3.5% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Brighthouse Financial, the consensus EPS estimate for the quarter has been revised marginally higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on BHF going forward to see if this recent jump can turn into more strength down the road.

 

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Brighthouse Financial is a member of the Zacks Insurance - Life Insurance industry. One other stock in the same industry, Sun Life (SLF - Free Report) , finished the last trading session 0.4% lower at $60.86. SLF has returned 1.6% over the past month.

For Sun Life, the consensus EPS estimate for the upcoming report has changed -1.4% over the past month to $1.3. This represents a change of +0.8% from what the company reported a year ago. Sun Life currently has a Zacks Rank of #3 (Hold).


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