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Lincoln's (LNC) Q2 Earnings Miss Estimates, Increase Y/Y
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Lincoln National Corporation’s (LNC - Free Report) second-quarter 2018 earnings of $2.02 per share missed the Zacks Consensus Estimate by 3.8%. However, the bottom line improved about 9.2% year over year, mainly led by solid performances across all segments, annuity sales and the recent acquisition of Liberty.
Lincoln National Corporation Price and EPS Surprise
Operating revenues of $4.02 billion increased 12.4% year over year and also surpassed the Zacks Consensus Estimate by 0.2%.
Insurance premium surged 45.4% year over year to $1165 million while fee income grew 5.5% to $1.47 billion.
Total expenses rose 17.3% to $3.57 billion year over year, mainly driven by higher benefits plus commission and other expenses.
Strong Segment Results
Operating income in the Annuities segment gained 10% year over year to $275 million. This was mainly driven by higher fee income generated from account value growth as well as lower expenditure.
Total annuity deposits soared 50% from the year-ago quarter to $3 billion, driven by growth in variable and fixed annuities.
Operating income in Retirement Plan Services increased 16% year over year to $43 million, banking on growth in fee income, recurring deposits and a lower tax rate. Total deposits piled up 12% from the prior-year quarter’s value to $2.2 billion owing to better first-year sales and recurring deposits.
Operating income in Life Insurance segment was up 13% year over year to $150 million as a result of lower tax rate and lower expenses. However, the same was partially offset by lower variable investment income.
Operating revenues inched up 1.5% year over year to $1.68 billion.
Operating income in Group Protection jumped 29% from the year-ago quarter’s figure to $45 million. This upside was driven by the buyout of the Liberty Mutual Group benefits business. Operating revenues skyrocketed 73.2% year over year to $937 million.
Other Operations
The company incurred a loss of $59 million, wider than $37 million incurred in the prior-year quarter.
Financial Update
As of Jun 30, 2018, Lincoln National’s book value per share, excluding accumulated other comprehensive income, climbed 8% year over year to $64.32.
Operating return on equity (ROE) excluding accumulated other comprehensive income and goodwill, improved 40 bps from the year-ago quarter’s number to 13.1%.
The company ended the quarter with long-term debt of $5.82 billion, up 18.8% year over year.
Among other players in the same space, the bottom line of Torchmark Corp. , Aflac Inc. (AFL - Free Report) and Genworth Financial Inc. (GNW - Free Report) beat the respective second-quarter estimates.
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It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Lincoln's (LNC) Q2 Earnings Miss Estimates, Increase Y/Y
Lincoln National Corporation’s (LNC - Free Report) second-quarter 2018 earnings of $2.02 per share missed the Zacks Consensus Estimate by 3.8%. However, the bottom line improved about 9.2% year over year, mainly led by solid performances across all segments, annuity sales and the recent acquisition of Liberty.
Lincoln National Corporation Price and EPS Surprise
Lincoln National Corporation Price and EPS Surprise | Lincoln National Corporation Quote
Operating revenues of $4.02 billion increased 12.4% year over year and also surpassed the Zacks Consensus Estimate by 0.2%.
Insurance premium surged 45.4% year over year to $1165 million while fee income grew 5.5% to $1.47 billion.
Total expenses rose 17.3% to $3.57 billion year over year, mainly driven by higher benefits plus commission and other expenses.
Strong Segment Results
Operating income in the Annuities segment gained 10% year over year to $275 million. This was mainly driven by higher fee income generated from account value growth as well as lower expenditure.
Total annuity deposits soared 50% from the year-ago quarter to $3 billion, driven by growth in variable and fixed annuities.
Operating income in Retirement Plan Services increased 16% year over year to $43 million, banking on growth in fee income, recurring deposits and a lower tax rate. Total deposits piled up 12% from the prior-year quarter’s value to $2.2 billion owing to better first-year sales and recurring deposits.
Operating income in Life Insurance segment was up 13% year over year to $150 million as a result of lower tax rate and lower expenses. However, the same was partially offset by lower variable investment income.
Operating revenues inched up 1.5% year over year to $1.68 billion.
Operating income in Group Protection jumped 29% from the year-ago quarter’s figure to $45 million. This upside was driven by the buyout of the Liberty Mutual Group benefits business. Operating revenues skyrocketed 73.2% year over year to $937 million.
Other Operations
The company incurred a loss of $59 million, wider than $37 million incurred in the prior-year quarter.
Financial Update
As of Jun 30, 2018, Lincoln National’s book value per share, excluding accumulated other comprehensive income, climbed 8% year over year to $64.32.
Operating return on equity (ROE) excluding accumulated other comprehensive income and goodwill, improved 40 bps from the year-ago quarter’s number to 13.1%.
The company ended the quarter with long-term debt of $5.82 billion, up 18.8% year over year.
Zacks Rank and Other Stocks
Lincoln National carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Among other players in the same space, the bottom line of Torchmark Corp. , Aflac Inc. (AFL - Free Report) and Genworth Financial Inc. (GNW - Free Report) beat the respective second-quarter estimates.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>