CNO Financial Group, Inc.’s CNO third-quarter 2016 net operating earnings of 37 cents per share beat the Zacks Consensus Estimate of 35 cents by 5.7%. The bottom line also improved by 23% year over year.
CNO Financial’s third -quarter revenues increased 12.4% year over year to $1 billion. The top line also surpassed the Zacks Consensus Estimate of $963 million by 5.5%.
Total new annualized premiums dipped 4% year over year to $100.2 million. However, collected premiums inched up 2% year over year to $900 million.
Segment Update
Bankers Life
Total collected premiums were $666 million, up 2.6% year over year. New annualized premiums were $57.2 million, down 5% year over year. Pre-tax operating earnings rose 10 % year over year, reflecting a $5.2 million release of long-term care reserves due to the impact of policyholder actions after rate increases.
WashingtonNational
Total collected premiums were $163.4 million, down 1.3% year over year. New Annualized premiums were $24.6 million, down 4.6% year over year. Pre-tax operating earnings in the reported quarter plunged 18% over the prior year quarter due to lower supplemental health margins.
Colonial Penn
Total collected premiums were $70.7 million, up 6% year over year New Annualized premiums was $18.4 million, down 2.6% year over year. Pre-tax operating earnings were $.9 million, up 50% year over year primarily driven by the business growth.
Corporate Operations
The segment includes investment advisory subsidiary and corporate expenses. Pre-tax losses were $4.4 million narrowed 20% from the loss of $11.9 million the year ago quarter owing to favorable investment returns.
CNO FINL GRP Price, Consensus and EPS Surprise
Financial Update
As of Jun 30, 2016, CNO Financial had total assets worth $32.4 billion, up 4.2% from $31.1 billion as of Dec 31, 2015. Total liabilities at the end of third quarter were $28 billion, up 3.7% year over year. Shareholder equity of $4.5 billion increased 9.7% from $4.1 billion at 2015 year end. The debt-to-capital ratio was 16.9%, down 100 basis points from 2015 year end.
As of Sep 30, consolidated risk-based capital ratio was estimated at 458%.
Book value per common share was $25.89, up 18% from 2015 year end.
Securities Repurchase and Divided Update
CNO Financial repurchased $52.0 million of common stock during the third quarter at an average cost of $16.80 per share.
However, the company has suspended its share repurchase program for the remainder of 2016 with a plan to increase its excess capital.
During 3Q16, dividends paid on common stock totaled $13.9 million.
Zacks Rank and Performance of Other Multiline Insurers
CNO Financial currently carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
Among the other insurers that have reported their third-quarter earnings so far, the bottom line at Progressive Corp.PGR and The Travelers Companies Inc. TRV beat their respective Zacks Consensus Estimate, while RLI Corp. RLI missed the same.
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