Lincoln National (NYSE:LNC) Announces Quarterly Earnings Results

Lincoln National (NYSE:LNC) announced its quarterly earnings data on Thursday. The financial services provider reported $1.72 earnings per share for the quarter, missing analysts’ consensus estimates of $1.96 by ($0.24), FiscalAI reports. Lincoln National had a net margin of 12.21% and a return on equity of 17.35%. The company had revenue of $5.06 billion for the quarter, compared to analysts’ expectations of $4.97 billion. During the same period last year, the firm earned $2.04 earnings per share.

Here are the key takeaways from Lincoln National’s conference call:

• Lincoln said it largely completed its three-year transformation goals, including transferring about 60% of guaranteed universal life reserves to reinsurance partners and addressing its preferred stock. With its Holdco cash build for the remaining preferred redemption complete, the company resumed share repurchases and expects to increase them, while continuing to invest in its businesses.
• Adjusted operating income available to common stockholders was $339 million, or $1.72 per share, including a $95 million after-tax reduction from the annual assumption review. Alternative investments returned 16.5% annualized, above the 10% target, contributing $55 million of after-tax above-target income.
• Annuity sales rose 21% sequentially to $4.3 billion, led by fixed annuity sales that more than doubled to $1.4 billion; spread-based products made up 67% of sales. Management expects fixed annuity momentum to continue, though it forecast fourth-quarter earnings roughly flat with the third quarter, excluding the review impact.
• Group Protection earnings fell to $77 million from $110 million a year earlier, as disability severity and the normalization of previously favorable incidence pressured results. Lincoln expects the full-year margin to finish at or modestly below the low end of its 8%–9% range, with incidence pressure expected to persist.
• Life earnings improved to $130 million from $54 million a year earlier, but results benefited from favorable mortality and above-target alternative returns; management said the business generated about $158 million over the past year excluding those factors. Retirement Plan Services earnings also increased, but first-year sales were down and management expects uneven flows as its strategic realignment proceeds.

Lincoln National Stock Up 2.3%

Lincoln National stock opened at $40.07 on Friday. The company has a current ratio of 0.27, a quick ratio of 0.27 and a debt-to-equity ratio of 0.62. The firm has a market cap of $7.67 billion, a price-to-earnings ratio of 2.47, a PEG ratio of 1.40 and a beta of 1.16. The stock has a fifty day simple moving average of $41.52 and a two-hundred day simple moving average of $39.02. Lincoln National has a 12 month low of $32.18 and a 12 month high of $47.67.

Analyst Upgrades and Downgrades

Several research firms have weighed in on LNC. TD Cowen lifted their target price on Lincoln National from $37.00 to $42.00 and gave the stock a “hold” rating in a report on Wednesday, July 22nd. JPMorgan Chase & Co. decreased their target price on Lincoln National from $49.00 to $47.00 and set an “underweight” rating for the company in a research report on Thursday, October 15th. Weiss Ratings reissued a “buy (b)” rating on shares of Lincoln National in a research report on Friday, October 30th. Wells Fargo & Company upped their price objective on shares of Lincoln National from $52.00 to $54.00 and gave the stock an “overweight” rating in a research report on Monday, October 12th. Finally, Barclays raised their price objective on shares of Lincoln National from $45.00 to $48.00 and gave the stock an “overweight” rating in a research report on Wednesday, October 7th. Seven equities research analysts have rated the stock with a Buy rating, five have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, Lincoln National presently has an average rating of “Hold” and a consensus price target of $48.67.

More Lincoln National News

Here are the key news stories impacting Lincoln National this week:

• Positive Sentiment: Revenue was $5.06 billion, ahead of the $4.97 billion consensus, while sales growth helped offset margin pressure. Reports also said quarterly profit rose. Read More.
• Positive Sentiment: Lincoln Financial said capital returns are resuming, with share repurchases expected to ramp after an initial $50 million start. Buybacks can support shareholder returns and signal confidence in capital generation. Read More.
• Negative Sentiment: Adjusted earnings were $1.72 per share, below the $1.96 analyst estimate and down from $2.04 a year earlier. The earnings shortfall may weigh on sentiment despite the revenue beat. Read More.
• Negative Sentiment: The company anticipates about $3 billion in Retirement Plan Services net outflows in the fourth quarter. That expected asset withdrawal, alongside margin pressure, could challenge future growth and profitability. Read More.

Insider Activity at Lincoln National

In related news, EVP Sean Woodroffe sold 11,000 shares of the firm’s stock in a transaction that occurred on Monday, August 17th. The shares were sold at an average price of $45.28, for a total transaction of $498,080.00. Following the completion of the sale, the executive vice president directly owned 119,947 shares in the company, valued at approximately $5,431,200.16. This trade represents a 8.40% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through the SEC website. Also, Director Gary C. Kelly sold 15,007 shares of Lincoln National stock in a transaction on Wednesday, August 12th. The shares were sold at an average price of $26.50, for a total value of $397,685.50. Additional details regarding this sale are available in the official SEC disclosure. Corporate insiders own 1.03% of the company’s stock.

Lincoln National Company Profile

Lincoln National Corporation, operating under the Lincoln Financial Group brand, is a financial services company that provides insurance and retirement products primarily in the United States. Its businesses are designed to help individuals, employers and institutions manage financial protection, income and long-term savings needs.

The company offers life insurance and annuities, including products intended to provide death-benefit protection, retirement income and asset accumulation. Through its group protection business, Lincoln also provides employer-sponsored disability, dental, vision and leave-management solutions, as well as related workplace benefits and services.

Lincoln traces its history to the founding of The Lincoln National Life Insurance Company in Fort Wayne, Indiana, in 1905.