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Here's Why Hold Strategy is Apt for Brighthouse Financial (BHF)
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Brighthouse Financial, Inc. (BHF - Free Report) is well-positioned for growth, driven by higher annuity and life insurance sales, conservative investment strategy, asset growth, improved interest rates, a well-diversified and high-quality portfolio, as well as sufficient liquidity.
Growth Projections
The Zacks Consensus Estimate for Brighthouse Financial’s 2024 earnings per share indicates a year-over-year increase of 16.4%. The consensus estimate for revenues is pegged at $8.62 billion, implying a year-over-year improvement of 2.8%.
The consensus estimate for 2025 earnings per share and revenues indicates an increase of 19.5% and 2.8%, respectively, from the corresponding 2024 estimates.
Zacks Rank & Price Performance
Brighthouse Financial currently carries a Zacks Rank #3 (Hold). Over the past year, the stock has gained 3.8% compared with the industry’s growth of 24.3%.
Image Source: Zacks Investment Research
Northbound Estimate Revision
The Zacks Consensus Estimate for 2025 earnings has moved 1% north in the past 60 days, reflecting analysts’ optimism.
Earnings Surprise History
Brighthouse Financial has a decent earnings surprise history. It beat estimates in three of the last four quarters and missed in one, the average being 0.91%.
Return on Equity
BHF’s return on equity for the trailing 12 months of 23.5% expanded 1,210 basis points year over year. This reflects the efficiency in utilizing its shareholders’ funds.
Business Tailwinds
Brighthouse Financial is well-poised for growth, with solid performances by the Annuities and Life segments.
BHF is one of the largest providers of life insurance products in the United States. Given the expansive and compelling suite of life products, the company should benefit from the growing individual insurance market. The insurer remains focused on ramping up sales of life insurance products and expanding its distribution network, aiming to become a premier player in the industry.
BHF remained focused on enhancing its product portfolio with the launch of Shield Level Pay Plus, which is an addition to the suite of Shield Annuities. Strong Shield Level Annuity sales and higher fixed indexed annuity sales from the company's recently launched SecureKey product boosted the Annuity sales. Fixed deferred annuities also contributed to the growth. Improved underwriting margin and net investment income should contribute to higher Life insurance sales.
Brighthouse Financial continues to be a leader in the buffered annuity marketplace. In May 2023, BHF introduced new enhancements to the Shield Level annuities product suite to help clients keep their retirement plans on track by providing additional growth opportunities in certain down markets. In November 2023, the insurer launched Brighthouse secure key fixed indexed annuities, which enabled it to expand the distribution footprint in the fixed indexed annuity market. BHF also expanded the life insurance suite with the launch of Brighthouse SmartGuard Plus, the first registered index-linked universal life insurance policy.
Net investment income has been exhibiting an improving trend over the past few quarters. Riding on asset growth, higher interest rates, a well-diversified and high-quality portfolio, and a conservative investment strategy, the insurer expects the metric to improve in the future.
Brighthouse Financial continued to focus on maintaining the strength of the balance sheet. As of Mar 31, 2024, the estimated combined risk-based capital ratio was 415-435%.
Given enhanced financial strength and flexibility, the company remains committed to returning capital to shareholders and intends to maintain an opportunistic share repurchase program to create significant value for them.
Stocks to Consider
Some better-ranked stocks from the insurance industry are Reinsurance Group of America, Incorporated (RGA - Free Report) , RLI Corp. (RLI - Free Report) and NMI Holdings Inc (NMIH - Free Report) . While Reinsurance Group sports a Zacks Rank #1 (Strong Buy), RLI Corp. and NMI Holdings carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Reinsurance Group has a solid track record of beating earnings estimates in each of the trailing four quarters, the average being 19.48%. In the past year, shares of RGA have jumped 44.9%.
The Zacks Consensus Estimate for RGA’s 2024 and 2025 earnings implies year-over-year growth of 3.9% and 5.5%, respectively.
RLI Corp. has a solid track record of beating earnings estimates in three of the trailing four quarters and missing in one, the average being 132.39%. In the past year, shares of RLI have gained 13.7%.
The Zacks Consensus Estimate for RLI’s 2024 and 2025 earnings implies year-over-year growth of 18.2% and 2.6%, respectively.
NMI Holdings has a solid track record of beating earnings estimates in each of the trailing four quarters, the average being 8.60%. In the past year, shares of NMIH have jumped 32.4%.
The Zacks Consensus Estimate for NMIH’s 2024 and 2025 earnings implies year-over-year growth of 10.4% and 7.5%, respectively.
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Here's Why Hold Strategy is Apt for Brighthouse Financial (BHF)
Brighthouse Financial, Inc. (BHF - Free Report) is well-positioned for growth, driven by higher annuity and life insurance sales, conservative investment strategy, asset growth, improved interest rates, a well-diversified and high-quality portfolio, as well as sufficient liquidity.
Growth Projections
The Zacks Consensus Estimate for Brighthouse Financial’s 2024 earnings per share indicates a year-over-year increase of 16.4%. The consensus estimate for revenues is pegged at $8.62 billion, implying a year-over-year improvement of 2.8%.
The consensus estimate for 2025 earnings per share and revenues indicates an increase of 19.5% and 2.8%, respectively, from the corresponding 2024 estimates.
Zacks Rank & Price Performance
Brighthouse Financial currently carries a Zacks Rank #3 (Hold). Over the past year, the stock has gained 3.8% compared with the industry’s growth of 24.3%.
Image Source: Zacks Investment Research
Northbound Estimate Revision
The Zacks Consensus Estimate for 2025 earnings has moved 1% north in the past 60 days, reflecting analysts’ optimism.
Earnings Surprise History
Brighthouse Financial has a decent earnings surprise history. It beat estimates in three of the last four quarters and missed in one, the average being 0.91%.
Return on Equity
BHF’s return on equity for the trailing 12 months of 23.5% expanded 1,210 basis points year over year. This reflects the efficiency in utilizing its shareholders’ funds.
Business Tailwinds
Brighthouse Financial is well-poised for growth, with solid performances by the Annuities and Life segments.
BHF is one of the largest providers of life insurance products in the United States. Given the expansive and compelling suite of life products, the company should benefit from the growing individual insurance market. The insurer remains focused on ramping up sales of life insurance products and expanding its distribution network, aiming to become a premier player in the industry.
BHF remained focused on enhancing its product portfolio with the launch of Shield Level Pay Plus, which is an addition to the suite of Shield Annuities. Strong Shield Level Annuity sales and higher fixed indexed annuity sales from the company's recently launched SecureKey product boosted the Annuity sales. Fixed deferred annuities also contributed to the growth. Improved underwriting margin and net investment income should contribute to higher Life insurance sales.
Brighthouse Financial continues to be a leader in the buffered annuity marketplace. In May 2023, BHF introduced new enhancements to the Shield Level annuities product suite to help clients keep their retirement plans on track by providing additional growth opportunities in certain down markets. In November 2023, the insurer launched Brighthouse secure key fixed indexed annuities, which enabled it to expand the distribution footprint in the fixed indexed annuity market. BHF also expanded the life insurance suite with the launch of Brighthouse SmartGuard Plus, the first registered index-linked universal life insurance policy.
Net investment income has been exhibiting an improving trend over the past few quarters. Riding on asset growth, higher interest rates, a well-diversified and high-quality portfolio, and a conservative investment strategy, the insurer expects the metric to improve in the future.
Brighthouse Financial continued to focus on maintaining the strength of the balance sheet. As of Mar 31, 2024, the estimated combined risk-based capital ratio was 415-435%.
Given enhanced financial strength and flexibility, the company remains committed to returning capital to shareholders and intends to maintain an opportunistic share repurchase program to create significant value for them.
Stocks to Consider
Some better-ranked stocks from the insurance industry are Reinsurance Group of America, Incorporated (RGA - Free Report) , RLI Corp. (RLI - Free Report) and NMI Holdings Inc (NMIH - Free Report) . While Reinsurance Group sports a Zacks Rank #1 (Strong Buy), RLI Corp. and NMI Holdings carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Reinsurance Group has a solid track record of beating earnings estimates in each of the trailing four quarters, the average being 19.48%. In the past year, shares of RGA have jumped 44.9%.
The Zacks Consensus Estimate for RGA’s 2024 and 2025 earnings implies year-over-year growth of 3.9% and 5.5%, respectively.
RLI Corp. has a solid track record of beating earnings estimates in three of the trailing four quarters and missing in one, the average being 132.39%. In the past year, shares of RLI have gained 13.7%.
The Zacks Consensus Estimate for RLI’s 2024 and 2025 earnings implies year-over-year growth of 18.2% and 2.6%, respectively.
NMI Holdings has a solid track record of beating earnings estimates in each of the trailing four quarters, the average being 8.60%. In the past year, shares of NMIH have jumped 32.4%.
The Zacks Consensus Estimate for NMIH’s 2024 and 2025 earnings implies year-over-year growth of 10.4% and 7.5%, respectively.