Yahoo Finance Sun Life (SLF) Q1 Earnings Beat on Higher Sales, Dividend Raised
Sun Life Financial Inc. SLF delivered first-quarter 2023 underlying net income of $1.12 per share, beating the Zacks Consensus Estimate by 4.7%. The bottom line decreased 1.8% year over year. The underlying net income of $662 million (C$895 million) was up 24% year over year driven by earnings growth in the U.S., Asia and Canada segments.
The insurer noted strong growth in both health and protection sales.
Group - Health & Protection sales increased 39.2% year over year to $402 million (C$543 million). Individual - Protection sales increased 25.2% year over year to $378 million (C$511 million).
Segment Results
SLF Canada’s underlying net income increased 53% year over year to $234 million (C$316 million), driven by improved results at Wealth & asset management, Group - Health & Protection as well as Individual - Protection.
SLF U.S.’ underlying net income was $175 million (C$237 million), which more than doubled from the prior-year quarter. The increase was driven by improved results at Group - Health & Protection.
SLF Asset Management’s underlying net income of $209 million (C$282 million) declined 12% year over year. The decrease was due to lower results in MFS, largely reflecting equity market declines and net outflows. The decline also reflects lower results at SLC Management as fee-related earnings growth was more than offset by higher financing costs on seed investments as well as higher compensation expenses.
SLF Asia reported an underlying net income of $104 million (C$141 million), which rose 6% year over year. The increase was driven by improved results at Individual - Protection.
Financial Update
Global assets under management were $1,007 billion (C$1,364 billion), up 0.9% year over year.
Sun Life Assurance’s Minimum Continuing Capital and Surplus Requirements (LICAT) ratio was 144% as of Mar 31, 2023, up 500 basis points (bps) year over year.
The LICAT ratio for Sun Life (including cash and other liquid assets) was 148% as of Mar 31, 2023, up 600 bps year over year
Sun Life’s return on equity was 15.6% in 2022, up 200 bps year over year. The underlying return on equity of 17.3% expanded 260 basis points year over year. The leverage ratio of 23.2% improved 50 bps year over year.
Dividend Update
On May 12, SLF’s board of directors approved a dividend of 75 cents per share, an increase of 4.2% from prior payout. The amount will be paid out on Jun 30, 2023 to shareholders of record at the close of business on May 31.
Zacks Rank
Sun Life currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
Reinsurance Group of America, Incorporated RGA reported first-quarter 2023 adjusted operating earnings of $5.16 per share, which beat the Zacks Consensus Estimate by 53%. The bottom line, however, increased 23.4% from the year-ago quarter. Operating revenues of $4.3 billion beat the Zacks Consensus Estimate by 2.4%. The top line also improved 6.7% year over year driven by higher net premiums and investment income and net of related expenses.
Net premiums of $3.4 billion rose 7.3% year over year. Investment income and net of related expenses increased 5.6% from the prior-year quarter to $856 million. The average investment yield was down 58 basis points (bps) to 4.71% due to lower variable investment income, partially offset by higher yields.
Voya Financial VOYA reported first-quarter 2023 adjusted operating earnings of $1.69 per share, which missed the Zacks Consensus Estimate by 1.7%. The bottom line however increased 15% year over year. Our estimate was $1.71. Adjusted operating revenues amounted to $261 billion, which decreased 4.4% year over year. The top line also missed the Zacks Consensus Estimate by 9.4%. Our estimate was $274.1 million.
Net investment income declined 13.9% year over year to $545 million. Our estimate was $2519.2 million. As of Mar 31, 2023, VOYA’s assets under management, assets under administration and advisement totaled $771.2 million.
American Equity Investment Life Holding Company AEL reported first-quarter 2023 adjusted net earnings of $1.47 per share, which beat the Zacks Consensus Estimate by 27.8% and our estimate of $1.02. The bottom line however increased 34.8% on a year-over-year basis. Operating total revenues were $644.4 million, up 0.9% year over year on the back of higher annuity product charges and other revenues.
Premiums and other considerations decreased 58.9% year over year to $4.1 million. The figure was lower than our estimate of $11.2 million. Net investment income decreased 1.1% on a year-over-year basis to $561 million. The investment spread was 2.67%, up from 2.51% in the year-ago quarter.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
American Equity Investment Life Holding Company (AEL) : Free Stock Analysis Report
Reinsurance Group of America, Incorporated (RGA) : Free Stock Analysis Report
Sun Life Financial Inc. (SLF) : Free Stock Analysis Report
Voya Financial, Inc. (VOYA) : Free Stock Analysis Report
