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Hartford Financial (HIG) Q1 Earnings: What's in the Offing?

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The Hartford Financial Services Group, Inc.(HIG - Free Report) will release first-quarter 2018 financial results on Apr 26, after the closing bell.

Last quarter, the company delivered a positive earnings surprise of 9.46%.  Let’s see, how things are shaping up for this announcement.

Q1 Expectations

Hartford Financial’s Commercial Lines and Personal Auto businesses have been delivering strong results over the past many quarters. The company also expects a solid performance from the Commercial Lines in small and middle markets. Notably, these two segments have contributed substantially to the company’s top-line appreciation.

Moreover, the company’s Group Benefit and Mutual Funds segments are likely to have delivered robust results, reflecting the company’s claims of improvements made in its book of business over the years.

Additionally, the company’s strategic investment in products, distribution, data and analytics as well as digital capabilities, aimed at customer acquisition and retention, are estimated to boost revenue growth.

Hartford Financial has also been enhancing shareholders value through frequent share repurchases, which might improve the bottom line in the first quarter, limiting the outstanding share count.

However, higher auto loss costs are anticipated to have affected the underwriting margins, repeating the trend from the previous quarters.

Earnings Whispers

Our proven model does not conclusively show that Hartford Financial is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as you will see below.

Zacks ESP: Hartford Financial has an Earnings ESP of -1.29%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

The Hartford Financial Services Group, Inc. Price and EPS Surprise

 

Zacks Rank: Hartford Financial carries a Zacks Rank #3, which increases the predictive power of ESP. However, a company needs to have a positive ESP to be confident about an earnings surprise. Thus, this combination leaves surprise prediction inconclusive. 

We caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are a few companies from the Finance sector that you may want to consider as these have the right combination of elements to  surpass estimates this time around:

Aflac Incorporated (AFL - Free Report) has an Earnings ESP of +1.73% and a Zacks Rank #2. The company is set to report first-quarter earnings on Apr 25. You can see the complete list of today’s Zacks #1 Rank stocks here.

Nasdaq, Inc. (NDAQ - Free Report) has an Earnings ESP of +0.31% and a Zacks Rank of 3. The company is set to report first-quarter earnings on Apr 25.

ConnectOne Bancorp, Inc. (CNOB - Free Report) has an Earnings ESP of +2.86% and is a Zacks #3 Ranked player. The company is set to report first-quarter earnings on Apr 25.

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