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VOYA Gains 44.5% in a Year: What Should Investors Do Now?

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Key Takeaways

  • VOYA benefits from Retirement growth, higher fee revenues and improved Employee Benefits profitability.
  • VOYA's institutional inflows hit $870 million in Q3, while Retirement client assets grew 12% to $878 billion.
  • VOYA targets over $800 million in 2026 excess capital, but competition and outflows remain concerns.

Shares of Voya Financial, Inc. (VOYA - Free Report) have gained 44.5% in the past year compared with the industry’s growth of 23.8%.

The performance was driven by improving profitability, strong Retirement business momentum and Employee Benefits margin recovery. Higher fee-based revenues, growing retirement assets and disciplined underwriting have strengthened its earnings outlook.

Shares of its other peers, including Reinsurance Group of America, Incorporated (RGA - Free Report) and Primerica, Inc. (PRI - Free Report) , have gained 45.1% and 14.9%, while Brighthouse Financial, Inc. (BHF - Free Report) has declined 32.9% in the past year.

1-Year Price Performance: VOYA, PRI, RGA, BHF & Industry

Zacks Investment Research

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VOYA Shares Are Affordable

Voya Financial shares are trading at a price-to-book value of 1.62X, lower than the industry average of 2.11X.

Zacks Investment Research
 

Image Source: Zacks Investment Research

Shares of RGA, PRI and BHF are trading at 1.52X, 2.08X and 0.50X, respectively, to the industry average.

VOYA’s Average Target Price Suggests Upside

Based on short-term price targets offered by 12 analysts, the Zacks average price target is $108.58 per share. The average suggests a potential 4.7% upside from the last closing price.

VOYA’s Growth Projection

The Zacks Consensus Estimate for Voya Financial’s 2026 earnings per share (EPS) indicates a 3.5% year-over-year increase. The consensus estimate for revenues is pegged at $1.31 billion, implying a 3.1% year-over-year decline. The consensus estimate for 2027 EPS and revenues indicates an increase of 23.9% and 12.5%, respectively, from the corresponding 2026 estimates.  

Earnings have grown 8.8% in the past five years, better than the industry average of 4.9%. The expected long-term earnings growth rate is 10.9%.

Factors Acting in Favor of VOYA

Voya Financial is benefiting from strong commercial momentum in its Retirement business, driven by growing participant accounts, high plan retention and rising fee-based revenues. Retirement fee-based revenues increased 12% over the trailing 12 months, accounting for more than 60% of segment revenues. Client assets rose 12% year over year to $878 billion, while participant accounts grew 5% to 10.3 million. Sustained growth in assets and fee-based revenues is expected to support recurring income and strengthen earnings visibility.

Management described the OneAmerica retirement acquisition as highly successful, generating returns above 30%. The acquisition has meaningfully strengthened the scale and earnings power of Voya’s Retirement business, which now serves nearly 10 million Retirement accounts.

Voya Financial's Investment Management business is benefiting from strong institutional demand and improving fee-based revenues. Institutional net inflows reached $870 million in the third quarter and $3.5 billion over the trailing 12 months, supported by demand for private fixed-income capabilities. More than 80% of assets outperformed benchmarks over the trailing three-year period. Strong investment performance and institutional demand could support client retention, asset growth and recurring management fees.

Voya Financial's Employee Benefits segment is benefiting from improved underwriting discipline and pricing actions. Adjusted operating earnings increased to $51 million in the third quarter from $47 million a year earlier, while trailing 12-month earnings more than doubled to $126 million. Favorable stop-loss development and disciplined pricing contributed to improved profitability. Continued rate actions, selective underwriting and growing benefit-administration fee revenues are expected to support further margin expansion.

Voya Financial is implementing expense-reduction initiatives to fund strategic investments in Wealth Management, Multiple Employer Plans and Investment Management capabilities. The company incurred $25 million of pretax severance costs in the third quarter, while management expects Retirement and Employee Benefits administrative expenses to remain in the lower half of its guidance range.

Voya Financial's strong capital generation supports shareholder distributions and earnings growth. The company generated $225 million of excess capital in the third quarter and expects more than $800 million of excess capital generation in 2026. The quarterly dividend was increased 21% to 57 cents per share, while the share repurchase authorization was expanded by $500 million. Continued capital generation and buybacks should support EPS growth and enhance shareholder returns.

Risks for VOYA

Voya's focus on underwriting profitability over premium growth continues to constrain Employee Benefits expansion. Annualized in-force premiums and fees declined to $3.5 billion in the quarter of 2026. Unfavorable actuarial updates in Voluntary Benefits and cautious Stop Loss reserving remain concerns.

Intense competition from financial institutions and investment managers could pressure pricing, client retention and asset growth. The exit of a legacy retail relationship resulted in approximately $5 billion of Investment Management outflows in the third quarter of 2026.

Conclusion

Voya Financial benefits from solid retirement business growth, higher fee-based revenues and improving profitability across key businesses. Strong net inflows, cost-saving initiatives and capital returns are expected to support its financial performance, while competitive pressures and outflows pose risks. Therefore, 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.    

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