It has been about a month since the last earnings report for Aflac (AFL Quick QuoteAFL - Free Report) . Shares have lost about 0.9% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Aflac due for a breakout? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for Aflac Incorporated before we dive into how investors and analysts have reacted as of late.

Aflac Q1 Earnings Miss Estimates on Lower Investment Income

Aflac reported first-quarter 2026 adjusted earnings per share (EPS) of $1.75, which missed the Zacks Consensus Estimate by 2.9%. However, the bottom line improved 5.4% year over year.

Adjusted revenues totaled $4.2 billion, which declined 1.9% year over year. The top line missed the consensus mark by 2.1%.

AFL’s quarterly performance was affected by lower net investment income and exchange rate. Nevertheless, the downside was partly offset by higher sales in the U.S. unit.

AFL’s Q1 Performance

Adjusted net investment income declined 1.2% year over year to $902 million in the quarter under review.

Net benefits and claims totaled $1.8 billion, which declined 5.8% year over year. Total acquisition and operating expenses decreased 1.5% year over year to $1.3 billion.

Pre-tax earnings increased to $1.2 billion from $145 million in the prior-year quarter.

Inside Aflac’s Segments

Aflac Japan: The segment’s adjusted revenues dipped 4.4% year over year to $2.2 billion in the first quarter and missed the Zacks Consensus Estimate of $2.3 billion. Net earned premiums of $1.6 billion slipped 6.4% year over year and missed the consensus mark by 3.1%.

Adjusted net investment income increased 0.9% year over year to $591 million. The unit’s pretax adjusted earnings rose 5.1% to $759 million but missed the consensus mark of $800.9 million.

New annualized premium sales advanced 25.5% year over year to $113 million on the back of solid sales of Anshin Palette, Miraito and Tsumitasu.

Aflac U.S.: Adjusted revenues of $1.8 billion grew 3.4% year over year and beat the Zacks Consensus Estimate by 0.3%. Net earned premiums advanced 3.5% year over year to $1.6 billion, attributable to higher sales. The metric beat the consensus mark of $1.5 billion.

Adjusted net investment income totaled $201 million, which inched down 0.5% year over year in the quarter under review. Pretax adjusted earnings of the segment increased 1.4% year over year to $363 million. The metric beat the consensus mark of $359.1 million.

The unit’s sales totaled $318 million, up 2.9% year over year, on the back of higher sales of group products.

Financial Position (As of March 31, 2026)

Aflac exited the first quarter with total investments and cash of $103.2 billion, down from the 2025-end level of $103.8 billion. Total assets of $116.3 billion decreased 0.2% from the year-end figure.

Adjusted debt amounted to $7.6 billion, down 1.2% from the figure as of Dec. 31, 2025. Adjusted debt to adjusted capitalization, excluding accumulated other comprehensive income, was 21.2%, which improved 20 basis points (bps) from the 2025-end level.

Total shareholders' equity of $30 billion advanced 1.6% from the 2025-end figure.

Adjusted book value per share increased 5.7% year over year to $54.96. Adjusted return on equity, excluding foreign currency impacts, was 16.4%, which improved 80 bps year over year.

AFL’s Capital Deployment

Aflac bought back shares worth $1 billion in the first quarter of 2026. Management paid a dividend of $315 million in the same quarter.

AFL’s 2026 Outlook

Aflac still expects a benefit ratio of 60-63% for the Aflac Japan unit in 2026. The metric for the Aflac U.S. unit is still projected to be in the 48-52% range.

The expense ratio for Aflac Japan is still estimated to be 20-23%. The same for Aflac U.S. is reiterated to be in the band of 36-39%.

Underlying earned premiums were likely to witness a year-over-year decline of 1-2% for the Japan unit in 2026. Net earned premiums for the U.S. unit were likely to be at the lower end of the 3-6% range.

The pretax profit margin for Aflac Japan is still estimated to be between 33% and 36%, and the same for Aflac U.S. is projected to be in the range of 17-20% for 2026.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in estimates review.

VGM Scores

At this time, Aflac has a poor Growth Score of F, a score with the same score on the momentum front. However, the stock has a score of C on the value side, putting it in the middle 20% for value investors.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Aflac has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Aflac is part of the Zacks Insurance - Accident and Health industry. Over the past month, Amerisafe (AMSF Quick QuoteAMSF - Free Report) , a stock from the same industry, has gained 0.9%. The company reported its results for the quarter ended March 2026 more than a month ago.

Amerisafe reported revenues of $81.75 million in the last reported quarter, representing a year-over-year change of +7.9%. EPS of $0.50 for the same period compares with $0.60 a year ago.

Amerisafe is expected to post earnings of $0.53 per share for the current quarter, representing no change from the year-ago quarter. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.

Amerisafe has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.