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CNO (CNO) Down 1.4% Since Last Earnings Report: Can It Rebound?
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It has been about a month since the last earnings report for CNO Financial (CNO - Free Report) . Shares have lost about 1.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is CNO due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
CNO Financial Q2 Earnings Beat Estimates, '24 EPS View Up
CNO Financial Group reported second-quarter 2024 adjusted earnings per share (EPS) of $1.05, which beat the Zacks Consensus Estimate by 45.8%. Moreover, the bottom line rose 94.4% year over year.
Total revenues increased 4.2% year over year to $1.07 billion in the second quarter. The top line beat the consensus mark by 16.4%.
The strong second-quarter results benefited from improved insurance product margin, premiums, and general account assets. However, the decline of the policyholder and other special-purpose portfolios partially offset the results.
Second-Quarter Performance
Total insurance policy income of $641.5 million improved 2.1% year over year and beat the Zacks Consensus Estimate by 1.2% due to a rise in annuity, health and life insurance policy incomes.
CNO’s net investment income increased 2.4% year over year to $409.1 million in the second quarter. General account assets grew 8.3% year over year to $351.7 million and beat the consensus mark by 14.1%. However, the policyholder and other special-purpose portfolios declined 37.3% year over year to $57.4 million.
Annuity collected premiums of $439.1 million increased 9.3% year over year. New annualized premiums for health and life products improved 4.3% year over year to $102.9 million. Annuity, Health and Life products accounted for 27.7%, 49.4% and 22.9%, respectively, of CNO’s insurance margin.
Total benefits and expenses were $915.6 million, which declined 1.2% year over year. The decline in the metric was due to liability for future policy benefits remeasurement gain and a decline in other operating costs and expenses.
Financial Update (as of Jun 30, 2024)
CNO Financial exited the second quarter with unrestricted cash and cash equivalents of $878.8 million, which increased from the 2023-end level of $774.5 million. Total assets of $36.3 billion increased from $35.1 billion at 2023-end.
The debt-to-capital ratio was 43% at the end of the second quarter. It has no outstanding debt maturities till 2025.
Total shareholders’ equity jumped to $2.4 billion from $2.2 billion as of Dec 31, 2023.
Book value per diluted share increased to $36 in the second quarter from $33.94 at 2023-end. Adjusted operating return on equity came in at 11.2%, which improved from 8% a year ago.
Share Repurchase and Dividend Update
CNO Financial rewarded its shareholders with $60 million in the form of share buybacks and dividends of $17.2 million.
As of Jun 30, 2024, the company had remaining repurchase funds of $421.8 million.
2024 Guidance
New Update
CNO Financial now expects 2024 EPS in the range of $3.30-$3.50, indicating an increase of 10% from the 2023 figure of $3.09. The company expects the expense ratio to be in the range of 19%-19.2% for 2024, improving from the 2023 level of 19.4%. It expects $200-$250 million excess cash flow to the holding company.
Previous View
The company continues to anticipate the effective tax rate for 2024 to be around 23%. It is also aiming at a leverage of 25 for this year.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
VGM Scores
Currently, CNO has a subpar Growth Score of D, a grade with the same score on the momentum front. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise CNO has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
CNO is part of the Zacks Insurance - Multi line industry. Over the past month, The Hartford (HIG - Free Report) , a stock from the same industry, has gained 1.5%. The company reported its results for the quarter ended June 2024 more than a month ago.
The Hartford reported revenues of $4.46 billion in the last reported quarter, representing a year-over-year change of +9.4%. EPS of $2.50 for the same period compares with $1.88 a year ago.
For the current quarter, The Hartford is expected to post earnings of $2.46 per share, indicating a change of +7.4% from the year-ago quarter. The Zacks Consensus Estimate has changed -2% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for The Hartford. Also, the stock has a VGM Score of C.
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CNO (CNO) Down 1.4% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for CNO Financial (CNO - Free Report) . Shares have lost about 1.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is CNO due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
CNO Financial Q2 Earnings Beat Estimates, '24 EPS View Up
CNO Financial Group reported second-quarter 2024 adjusted earnings per share (EPS) of $1.05, which beat the Zacks Consensus Estimate by 45.8%. Moreover, the bottom line rose 94.4% year over year.
Total revenues increased 4.2% year over year to $1.07 billion in the second quarter. The top line beat the consensus mark by 16.4%.
The strong second-quarter results benefited from improved insurance product margin, premiums, and general account assets. However, the decline of the policyholder and other special-purpose portfolios partially offset the results.
Second-Quarter Performance
Total insurance policy income of $641.5 million improved 2.1% year over year and beat the Zacks Consensus Estimate by 1.2% due to a rise in annuity, health and life insurance policy incomes.
CNO’s net investment income increased 2.4% year over year to $409.1 million in the second quarter. General account assets grew 8.3% year over year to $351.7 million and beat the consensus mark by 14.1%. However, the policyholder and other special-purpose portfolios declined 37.3% year over year to $57.4 million.
Annuity collected premiums of $439.1 million increased 9.3% year over year. New annualized premiums for health and life products improved 4.3% year over year to $102.9 million. Annuity, Health and Life products accounted for 27.7%, 49.4% and 22.9%, respectively, of CNO’s insurance margin.
Total benefits and expenses were $915.6 million, which declined 1.2% year over year. The decline in the metric was due to liability for future policy benefits remeasurement gain and a decline in other operating costs and expenses.
Financial Update (as of Jun 30, 2024)
CNO Financial exited the second quarter with unrestricted cash and cash equivalents of $878.8 million, which increased from the 2023-end level of $774.5 million. Total assets of $36.3 billion increased from $35.1 billion at 2023-end.
The debt-to-capital ratio was 43% at the end of the second quarter. It has no outstanding debt maturities till 2025.
Total shareholders’ equity jumped to $2.4 billion from $2.2 billion as of Dec 31, 2023.
Book value per diluted share increased to $36 in the second quarter from $33.94 at 2023-end. Adjusted operating return on equity came in at 11.2%, which improved from 8% a year ago.
Share Repurchase and Dividend Update
CNO Financial rewarded its shareholders with $60 million in the form of share buybacks and dividends of $17.2 million.
As of Jun 30, 2024, the company had remaining repurchase funds of $421.8 million.
2024 Guidance
New Update
CNO Financial now expects 2024 EPS in the range of $3.30-$3.50, indicating an increase of 10% from the 2023 figure of $3.09. The company expects the expense ratio to be in the range of 19%-19.2% for 2024, improving from the 2023 level of 19.4%. It expects $200-$250 million excess cash flow to the holding company.
Previous View
The company continues to anticipate the effective tax rate for 2024 to be around 23%. It is also aiming at a leverage of 25 for this year.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
VGM Scores
Currently, CNO has a subpar Growth Score of D, a grade with the same score on the momentum front. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise CNO has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
CNO is part of the Zacks Insurance - Multi line industry. Over the past month, The Hartford (HIG - Free Report) , a stock from the same industry, has gained 1.5%. The company reported its results for the quarter ended June 2024 more than a month ago.
The Hartford reported revenues of $4.46 billion in the last reported quarter, representing a year-over-year change of +9.4%. EPS of $2.50 for the same period compares with $1.88 a year ago.
For the current quarter, The Hartford is expected to post earnings of $2.46 per share, indicating a change of +7.4% from the year-ago quarter. The Zacks Consensus Estimate has changed -2% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for The Hartford. Also, the stock has a VGM Score of C.