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MetLife (MET) Q4 Earnings Beat, Revenues Miss Estimates

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MetLife, Inc.’s (MET - Free Report) fourth-quarter 2017 operating earnings of $1.11 per share beat the Zacks Consensus Estimate by 0.91%. Also, the bottom line increased 3% year over year.

MetLife, Inc. Price, Consensus and EPS Surprise

 

Though performances at U.S., Asia and MetLife Holdings remained soft, strong EMEA and Latin America segments limited the downside.

The company generated operating revenues of $15.8 billion, down 8.2% year over year. Also, the top line missed the Zacks Consensus Estimate by 0.62%.

Full-Year Highlights

MetLife posted net income of $3.38 per share on $62.1 billion revenues. While the bottom line improved nearly six times, the top line rose 2.5% over 2016.

Quarterly Segment Details

U.S.

Adjusted earnings in this segment declined 3% year over year to $498 million, attributable to increasing certain RIS policy reserves. Operating premiums, fees & other revenues increased 4% to $6 billion.

Asia

Operating earnings of $310 million were down 12% year over year on both reported and constant currency basis on higher Japan tax rate. Operating premiums, fees & other revenues in Asia decreased 2% (up 3% on a constant currency basis) to $2.1 billion.

Latin America

Operating earnings were $125 million, up 2% (unchanged on a constant currency basis) year over year. Earnings improved owing to volume growth, partially offset by higher expenses and taxes. Operating premiums, fees & other revenues were $8988 million, up 8% on reported and 5% on constant currency basis.

EMEA

Operating earnings from EMEA increased 10% (or 5% on constant currency basis) year over year to $79 million due to volume growth in Turkey and Western Europe and lowered expenses. Operating premiums, fees & other revenues were $651 million, up 5% reportedly and 1% on constant currency basis.

MetLife Holdings

Operating earnings from MetLife Holdings came in at $194 million, down 3% year over year, attributable to lower interest margin and the impact of notable adjustments recorded in the current and prior periods. Operating premiums, fees & other revenues were $1.5 billion, down 11%, primarily due to Brighthouse separation-related impacts.

Corporate & Other

Corporate & other incurred an operating loss of $528 million, wider than the loss of $203 million in the prior-year quarter.

Financial Update

Variable investment income decreased to $140 million from $215993 million in the year-ago quarter due to weaker alternative investments performance and lower prepayments.

Book value per share decreased 9.7% year over year to $53.57 per share as of Dec 31, 2017.

Adjusted tangible return on equity expanded 200 basis points to 10.6%.

Zacks Rank

MetLife carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Insurers

Among other players from the multiline insurance industry that have reported fourth-quarter earnings so far, the bottom line of Prudential Financial, Inc. (PRU - Free Report) , CNO Financial Group, Inc. (CNO - Free Report) and Cigna Corp. (CI - Free Report) topped the respective Zacks Consensus Estimate.

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