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Torchmark (TMK) Q2 Earnings Coming Up: What's in Store?

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Torchmark Corporation is slated to report second-quarter 2019 results on Jul 24, after market close. The company delivered positive earing surprise in three of the last four quarters.

Let’s see how things are shaping up for this announcement.

Torchmark’s second-quarter premiums are likely to benefit from solid performances across its distribution channel. Increased agent count is expected to boost sales. The Zacks Consensus Estimate for premium is pegged at $894 million, indicating an increase of 4.7% year over year.

Continued superior performance at American Income, consistent operations at Global Life and growth at Liberty National likely are likely to drive life premiums. The Zacks Consensus Estimate for life premiums is pegged at $629 million, suggesting 4.3% year-over-year growth.

Improved interest rate environment and higher new money rates are likely to aid investment income in the second quarter.

Administrative expenses are expected to rise due to higher pension costs as a result of the required implementation of a new mortality table and investments in IT systems.

Sustained buyback should provide a boost to the bottom line.

The Zacks Consensus Estimate for earnings stands at $1.65, implying 9.3% growth from the year-ago quarter.

What Our Quantitative Model States

Our proven model does not conclusively show that Torchmark is likely to beat on earnings in the to-be-reported quarter. This is because a stock needs to have both a positive Earnings ESP and a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as you will see below.

Earnings ESP: Torchmark has an Earnings ESP of 0.00%. This is because both he Zacks Consensus Estimate and the Most Accurate Estimate are pegged at $1.65. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Torchmark Corporation Price and EPS Surprise

Zacks Rank: Torchmark carries a Zacks Rank #3, which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult.

We caution against the Sell-rated stocks (#4 or 5) going into an earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Some stocks from the insurance industry with the apt combination of elements to surpass estimates this reporting cycle are as follows:

Sun Life Financial Inc. (SLF - Free Report) is set to report second-quarter earnings on Jul 31 and has an Earnings ESP of +2.95%. The company has a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Lincoln National Corporation (LNC - Free Report) has an Earnings ESP of +0.52% and is a Zacks #3 Ranked player. The company is slated to announce second-quarter earnings on Jul 31.

Voya Financial, Inc. (VOYA - Free Report) has an Earnings ESP of +1.06% and a Zacks Rank of 3. The company is set to release second-quarter earnings on Aug 6.

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