Yahoo Finance Prudential Financial (PRU) Q1 Earnings Miss, Revenues Rise Y/Y
Prudential Financial, Inc. PRU reported first-quarter 2024 adjusted operating income of $3.12 per share, which missed the Zacks Consensus Estimate by 1.2%. The bottom line climbed 15.5% year over year.
Total revenues of $21.7 billion jumped 44.8% year over year, beating the Zacks Consensus Estimate by 46.8%. The rise in revenues was due to higher premiums, net investment income, asset management fees, commissions and other income.
Prudential Financial's quarterly results reflected a rise in asset management fees, positive third-party net flows, improved net investment spread results and favorable underwriting results, offset by higher expenses.
Prudential Financial, Inc. Price, Consensus and EPS Surprise
Prudential Financial, Inc. price-consensus-eps-surprise-chart | Prudential Financial, Inc. Quote
Operational Update
Total benefits and expenses amounted to $20.2 billion, which soared 47.6% year over year in the first quarter. This increase was due to higher insurance and annuity benefits, interest credited to policyholders' account balances, interest expense, amortization of acquisition costs and general and administrative expenses. The figure was higher than our estimate of $11.7 billion.
Quarterly Segment Update
Prudential Global Investment Management’s (PGIM) adjusted operating income of $169 million increased 12% year over year. The metric beat the Zacks Consensus Estimate by 14%. Our estimate was $137.2 million. This increase was driven by higher asset management fees and other related revenues due to improved incentive fees and seed and co-investment income. It was partially offset by higher expenses.
PGIM’s assets under management of $1.341 trillion in the reported quarter increased 6% year over year. The increase was due to equity market appreciation and positive third-party net flows.
The U.S. Businesses delivered an adjusted operating income of $839 million, which grew 10.4% year over year. The metric missed the Zacks Consensus Estimate by 12%. Our estimate was $1 billion. The rise was primarily driven by higher net investment spread results and more favorable underwriting results. It was partially offset by higher expenses and lower net fee income.
International Businesses’ adjusted operating income rose 6.7% year over year to $896 million in the first quarter. The metric was higher than our estimate of $878.4 million. This increase was primarily due to higher net investment spread results and joint venture earnings, partially offset by less favorable underwriting results.
Corporate and Other incurred an adjusted operating loss of $435 million, narrower than the loss of $471 million reported a year ago, primarily due to a decline in expenses. The figure was narrower than the Zacks Consensus Estimate of a loss of $474 million and our estimate of a loss of $471.3 million.
Capital Deployment
Prudential Financial managed to return capital to its shareholders in the form of share repurchases worth $250 million and dividends worth $476 million in the first quarter.
Financial Update
PRU exited the first quarter with cash and cash equivalents of $18.7 billion, which decreased 3.5% from the end of 2023.
Total debt balance of $19.9 billion increased 2.3% from 2023-end.
As of Mar 31, 2024, Prudential Financial’s assets under management and administration rose 6.5% year over year to $1.67 trillion.
Adjusted book value per common share, a measure of the company’s net worth, came in at $97.03, which decreased 0.2% year over year.
Operating return on average equity was 13% in the first quarter, which expanded 170 basis points year over year.
Zacks Rank
Prudential Financial currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
Unum Group’s UNM first-quarter 2024 operating net income of $2.12 per share beat the Zacks Consensus Estimate by 7.6%. The bottom line increased 13.3% year over year. Total operating revenues of Unum Group were $3.2 billion, up 5.5% year over year, driven by higher premium income, net investment income and other income. The top line beat the Zacks Consensus Estimate by 0.3%.
Premiums increased 6.1% from the prior-year quarter to $2.6 billion and were in line with our estimate. Total benefits and expenses rose 4.6% year over year to $2.7 billion. Our estimate was $2.6 billion.
Chubb Limited CB reported first-quarter 2024 core operating income of $5.41 per share, which outpaced the Zacks Consensus Estimate by 2.3%. The bottom line jumped 22.7% year over year. Net premiums written improved 14.1% year over year to $12.2 billion in the quarter. Our estimate was $11.4 billion, while the Zacks Consensus Estimate was pegged at $13 billion.
Net investment income was $1.4 billion, up 25.7% year over year. The Zacks Consensus Estimate was pegged at $1.3 billion, while our estimate for the same was $1.4 billion. Property and Casualty (P&C) underwriting income was $1.4 billion, up 16.7% year over year. Global P&C underwriting income, excluding Agriculture, was $1.3 billion, up 10.9%.
Voya Financial, Inc. VOYA reported first-quarter 2023 adjusted operating earnings of $1.88 per share, which beat the Zacks Consensus Estimate by 18.9%. The bottom line, however, increased 11.2% year over year. Adjusted operating revenues amounted to $1.9 billion, which rose 8.9% year over year, driven by higher fee income, premiums and other revenues.
Net investment income declined 2.9% year over year to $529 million. Meanwhile, fee income of $513 million climbed 10.5% year over year. Premiums totaled $800 million, up 16.8% from the year-ago quarter. Total benefits and expenses were $1.7 billion, up 4.1% from the year-ago quarter. As of Mar 31, 2024, VOYA’s assets under management, assets under administration and advisement totaled $848.6 billion.
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