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VOYA Stock Gains 36.1% in a Year: What Should Investors Do Now?
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Key Takeaways
VOYA's Retirement business is gaining from strong sales, high retention and the OneAmerica acquisition.
Voya targets more than 2% organic growth in Investment Management, supported by strategic partnerships.
VOYA returned $200M to shareholders in Q1 but faces higher leverage and investment-related margin pressure.
Shares of Voya Financial, Inc. (VOYA - Free Report) have gained 36.1% in the past year, outperforming the industry’s growth of 18.8%.
Growth in the Retirement and Investment Management segments, improved employee benefits segments, strategic acquisitions and partnerships, record net flows, and excess capital generation are driving the stock performance. The momentum is likely to sustain with scope for further upside, supported by continued strength in the Retirement and Investment Management businesses, strategic acquisitions and ongoing share repurchases.
Voya Financial has outperformed its peers, including Reinsurance Group of America, Incorporated (RGA - Free Report) , Primerica, Inc. (PRI - Free Report) and Brighthouse Financial, Inc (BHF - Free Report) . Shares of RGA, PRI and BHF have gained 8.4%, 8.1% and 7.4%, respectively, in the past year.
1-Year Performance: VOYA, RGA, PRI, BHF & Industry
Image Source: Zacks Investment Research
VOYA’s Attractive Valuation
Voya Financial shares are trading at a price-to-book value of 1.29X, lower than the industry average of 2.16X.
Image Source: Zacks Investment Research
VOYA’s Growth Projection
The Zacks Consensus Estimate for Voya Financial’s 2026 earnings per share (EPS) indicates a year-over-year increase of 8.4%. The consensus estimate for revenues is pegged at $1.33 billion, implying a year-over-year decline of 0.7%.
The consensus estimate for 2027 EPS and revenues indicates an increase of 14.8% and 7.4%, respectively, from the corresponding 2026 estimates.
Earnings have grown 8.8% in the past five years, better than the industry average of 5.9%. The expected long-term earnings growth rate is 11.5%.
Muted analyst sentiment for VOYA
One of the three analysts has raised earnings estimates for 2026 and 2027 over the past 30 days. However, the Zacks Consensus Estimate for 2026 and 2027 earnings has moved south 0.5% and 2.2%, respectively, over the same period.
Factors Acting in Favor of VOYA
VOYA’s earnings are driven by its solid segmental performances across Retirement, Investment Management and Employee Benefits segments. These businesses represent higher-growth, capital-light and higher-return units, bolstering the company’s solid presence in the market.
The Retirement segment is steadily experiencing significant growth on the back of higher revenues, favorable market impacts, higher alternative investment income and active portfolio management, positive defined contribution flows, as well as disciplined management of spend. Management expects strong commercial momentum in retirement, driven by robust sales, more than 95% retention and new plan implementations.
Management described the OneAmerica retirement acquisition as highly successful, generating returns above 30%. It has meaningfully strengthened the scale and earnings power of the Retirement business, which now serves nearly 10 million Retirement accounts.
The Investment Management segment should benefit from higher investment capital returns, primarily driven by overall market performance, higher fee-based revenues, benefiting from strong commercial momentum and disciplined management of spend. Voya Financial remains confident in sustaining more than 2% organic growth. Management also highlighted continued strength in retail income and growth strategies. VOYA is constantly taking strategic steps to ramp up growth in its Investment Management segment. Voya Financial and Allianz Global Investors' long-term strategic partnership added scale and diversification to Voya Investment Management.
The Employee Benefits segment of the insurer is likely to gain from unfavorable stop-loss claim development in the prior period, a smaller block of business in the current period, lower premium-driven expenses, disciplined management of spend, higher alternative investment income and active portfolio management.
The company’s capital levels remain strong. In the first quarter of 2026, VOYA generated approximately $200 million of excess capital and returned that amount to shareholders through repurchases and dividends. VOYA repurchased an additional $150 million of shares in the second quarter, with $413 million remaining under its buyback authorization.
Risks for VOYA
The company plans to invest up to $75 million of excess capital in 2026 to strengthen its wealth management platform. These investments are expected to create a near-term earnings drag and reduce Retirement segment margins by about 200 basis points.
VOYA faces intense competition from broker-dealers, financial advisors, diversified financial institutions and start-up financial services providers, which could result in increased pressure on the pricing of certain products and services.
Voya's ROE has declined over the past two years due to weaker margins and operational pressures in Health Solutions and Employee Benefits. Additionally, long-term debt rose to $1.9 billion, up 26% from year-end 2025, causing the financial leverage ratio to deteriorate 220 basis points year over year to 29.7%. Higher leverage and lower profitability could weigh on future earnings and returns.
Conclusion
Voya Financial is well-positioned for strong earnings growth across all three business segments, positive net flows, favorable retention and strategic partnerships. It should continue to benefit from financial flexibility and effective capital deployment. However, high competition, weakened ROE and a rise in debt are the concerns.
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VOYA Stock Gains 36.1% in a Year: What Should Investors Do Now?
Key Takeaways
Shares of Voya Financial, Inc. (VOYA - Free Report) have gained 36.1% in the past year, outperforming the industry’s growth of 18.8%.
Growth in the Retirement and Investment Management segments, improved employee benefits segments, strategic acquisitions and partnerships, record net flows, and excess capital generation are driving the stock performance. The momentum is likely to sustain with scope for further upside, supported by continued strength in the Retirement and Investment Management businesses, strategic acquisitions and ongoing share repurchases.
Voya Financial has outperformed its peers, including Reinsurance Group of America, Incorporated (RGA - Free Report) , Primerica, Inc. (PRI - Free Report) and Brighthouse Financial, Inc (BHF - Free Report) . Shares of RGA, PRI and BHF have gained 8.4%, 8.1% and 7.4%, respectively, in the past year.
1-Year Performance: VOYA, RGA, PRI, BHF & Industry
Image Source: Zacks Investment Research
VOYA’s Attractive Valuation
Voya Financial shares are trading at a price-to-book value of 1.29X, lower than the industry average of 2.16X.
Image Source: Zacks Investment Research
VOYA’s Growth Projection
The Zacks Consensus Estimate for Voya Financial’s 2026 earnings per share (EPS) indicates a year-over-year increase of 8.4%. The consensus estimate for revenues is pegged at $1.33 billion, implying a year-over-year decline of 0.7%.
The consensus estimate for 2027 EPS and revenues indicates an increase of 14.8% and 7.4%, respectively, from the corresponding 2026 estimates.
Earnings have grown 8.8% in the past five years, better than the industry average of 5.9%. The expected long-term earnings growth rate is 11.5%.
Muted analyst sentiment for VOYA
One of the three analysts has raised earnings estimates for 2026 and 2027 over the past 30 days. However, the Zacks Consensus Estimate for 2026 and 2027 earnings has moved south 0.5% and 2.2%, respectively, over the same period.
Factors Acting in Favor of VOYA
VOYA’s earnings are driven by its solid segmental performances across Retirement, Investment Management and Employee Benefits segments. These businesses represent higher-growth, capital-light and higher-return units, bolstering the company’s solid presence in the market.
The Retirement segment is steadily experiencing significant growth on the back of higher revenues, favorable market impacts, higher alternative investment income and active portfolio management, positive defined contribution flows, as well as disciplined management of spend. Management expects strong commercial momentum in retirement, driven by robust sales, more than 95% retention and new plan implementations.
Management described the OneAmerica retirement acquisition as highly successful, generating returns above 30%. It has meaningfully strengthened the scale and earnings power of the Retirement business, which now serves nearly 10 million Retirement accounts.
The Investment Management segment should benefit from higher investment capital returns, primarily driven by overall market performance, higher fee-based revenues, benefiting from strong commercial momentum and disciplined management of spend. Voya Financial remains confident in sustaining more than 2% organic growth. Management also highlighted continued strength in retail income and growth strategies. VOYA is constantly taking strategic steps to ramp up growth in its Investment Management segment. Voya Financial and Allianz Global Investors' long-term strategic partnership added scale and diversification to Voya Investment Management.
The Employee Benefits segment of the insurer is likely to gain from unfavorable stop-loss claim development in the prior period, a smaller block of business in the current period, lower premium-driven expenses, disciplined management of spend, higher alternative investment income and active portfolio management.
The company’s capital levels remain strong. In the first quarter of 2026, VOYA generated approximately $200 million of excess capital and returned that amount to shareholders through repurchases and dividends. VOYA repurchased an additional $150 million of shares in the second quarter, with $413 million remaining under its buyback authorization.
Risks for VOYA
The company plans to invest up to $75 million of excess capital in 2026 to strengthen its wealth management platform. These investments are expected to create a near-term earnings drag and reduce Retirement segment margins by about 200 basis points.
VOYA faces intense competition from broker-dealers, financial advisors, diversified financial institutions and start-up financial services providers, which could result in increased pressure on the pricing of certain products and services.
Voya's ROE has declined over the past two years due to weaker margins and operational pressures in Health Solutions and Employee Benefits. Additionally, long-term debt rose to $1.9 billion, up 26% from year-end 2025, causing the financial leverage ratio to deteriorate 220 basis points year over year to 29.7%. Higher leverage and lower profitability could weigh on future earnings and returns.
Conclusion
Voya Financial is well-positioned for strong earnings growth across all three business segments, positive net flows, favorable retention and strategic partnerships. It should continue to benefit from financial flexibility and effective capital deployment. However, high competition, weakened ROE and a rise in debt are the concerns.
Given the muted analyst sentiment, it is wise to retain this Zacks Rank #3 (Hold) stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here