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What's in the Cards for Unum Group (UNM) in Q4 Earnings?

Zacks Equity Research
·4-min read

Unum Group UNM will report fourth-quarter 2019 results on Feb 4, after market close.

For the to-be-reported quarter, the Zacks Consensus Estimate for earnings is pegged at $1.38 per share, indicating an upside of 6.3% from the year-ago reported figure.

The consensus mark for revenues suggests an upside of 3% from the year-earlier reported number.

Factors at Play

Unum Group’s fourth-quarter results are likely to gain traction from strong persistency trends and renewal premium increases at its core businesses. Further, this might have fueled premium growth and its Unum US business line.

Net investment income of the company is expected to have been flat in the to-be-reported quarter, mainly due to weak performance by its Closed Block segment. The Zacks Consensus Estimate for the metric is pegged at $609 million, implying no change from the prior-year reported figure.

The Zacks Consensus Estimate for Unum U.S. premium is pegged at $1.5 billion, hinting at 5% increase from the year-ago reported figure while that for Colonial Life stands at $431 million, indicating 5.1% improvement from the year-ago reported number.

The Zacks Consensus Estimate for premium income is pegged at nearly $2.3 billion, suggesting 3.8% growth from the year-ago reported figure.

The inclusion of Unum Poland is expected to have supported the company’s Unum International business, a trend that most likely continued from the previous quarter.

The company’s initiatives to keep costs under control are likely to have aided margins. The cost-curbing measures might have been maintained to help the company achieve overall productivity and profitability of its business.

However, interest expenses are likely to have escalated given higher debt level.

What Our Quantitative Model States

Our proven model does not conclusively predict an earnings beat for Unum Group this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of beating estimates. But that’s not the case here.

Earnings ESP: Unum Group has an Earnings ESP of -0.30%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. You can see the complete list of today’s Zacks #1 Rank stocks here.

Unum Group Price and EPS Surprise

Unum Group Price and EPS Surprise
Unum Group Price and EPS Surprise

Unum Group price-eps-surprise | Unum Group Quote

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Zacks Rank: Unum Group carries a Zacks Rank #3.

Highlights of Q3 Earnings

Unum Group’s third-quarter 2019 operating net income of $1.36 per share missed the Zacks Consensus Estimate and also fell short of the year-ago quarterly earnings by 0.7%. Unum U.S. and Unum International results were soft. However, the company generated top-line growth and recorded solid profit margins.

Stocks to Consider

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

American International Group, Inc. AIG is slated to report fourth-quarter earnings on Feb 13. It has a Zacks Rank of 3 and an Earnings ESP of +3.37%.

Assurant, Inc. AIZ is set to report fourth-quarter earnings on Feb 11. The company is Zacks #3 Ranked and has an Earnings ESP of +0.62%.

Radian Group Inc. RDN is slated to announce fourth-quarter earnings on Feb 5. The stock has an Earnings ESP of +1.76% and is a #3 Ranked player.

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Radian Group Inc. (RDN) : Free Stock Analysis Report
 
Unum Group (UNM) : Free Stock Analysis Report
 
American International Group, Inc. (AIG) : Free Stock Analysis Report
 
Assurant, Inc. (AIZ) : Free Stock Analysis Report
 
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Zacks Investment Research