Lincoln National (NYSE:LNC) Releases Earnings Results, Beats Expectations By $0.28 EPS

Lincoln National (NYSE:LNC) announced its quarterly earnings data on Thursday. The financial services provider reported $2.24 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.96 by $0.28, FiscalAI reports. The business had revenue of $4.93 billion for the quarter, compared to analysts’ expectations of $4.89 billion. Lincoln National had a return on equity of 18.07% and a net margin of 9.17%.The company’s revenue for the quarter was up 12.3% compared to the same quarter last year. During the same period last year, the firm earned $2.36 earnings per share.

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

• Adjusted operating income rose 3% year over year to $439 million, marking Lincoln Financial’s eighth consecutive quarter of annual earnings growth. Retirement Plan Services earnings increased 32%, while Life Insurance earnings benefited from favorable mortality.
• Lincoln agreed to reinsure approximately $5.8 billion of legacy Guaranteed Universal Life reserves with Talcott, reducing long-term mortality, lapse, and interest-rate risk. The transaction is expected to increase annual free cash flow by roughly $30 million to $40 million and close in the fourth quarter, subject to regulatory approval.
• Capital flexibility improved as holding-company cash net of prefunding reached about $900 million, the company issued $500 million of hybrid securities, and half of its preferred stock obligations was prefunded. Management said its existing share-repurchase authorization has been reconfirmed, though it did not provide timing for resuming buybacks.
• Results faced several offsets, including alternative-investment returns of approximately 4.9% versus a 10% target, $2.9 billion of annuity net outflows, and $2.4 billion of Retirement Plan Services outflows from unprofitable plan exits. Group Protection earnings and margins also declined year over year as unusually favorable disability experience normalized.

Lincoln National Stock Up 11.2%

NYSE:LNC traded up $4.62 during trading hours on Thursday, hitting $46.05. The company’s stock had a trading volume of 5,837,229 shares, compared to its average volume of 1,822,970. Lincoln National has a 52-week low of $32.18 and a 52-week high of $46.82. The company has a current ratio of 0.25, a quick ratio of 0.25 and a debt-to-equity ratio of 0.65. The stock has a market capitalization of $8.81 billion, a P/E ratio of 5.34, a price-to-earnings-growth ratio of 2.93 and a beta of 1.17. The stock has a fifty day moving average of $38.04 and a 200-day moving average of $37.40.

Lincoln National Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Monday, August 3rd. Investors of record on Friday, July 10th will be issued a $0.45 dividend. This represents a $1.80 annualized dividend and a yield of 3.9%. The ex-dividend date of this dividend is Friday, July 10th. Lincoln National’s dividend payout ratio is 20.88%.

Analyst Upgrades and Downgrades

Several research analysts recently commented on LNC shares. UBS Group boosted their target price on Lincoln National from $39.00 to $44.00 and gave the stock a “neutral” rating in a research note on Wednesday, July 8th. National Bank Financial set a $51.00 price target on Lincoln National in a research report on Thursday, July 9th. Keefe, Bruyette & Woods lifted their price objective on Lincoln National from $44.00 to $46.00 and gave the company an “outperform” rating in a research note on Monday, July 13th. Weiss Ratings downgraded Lincoln National from a “buy (b-)” rating to a “hold (c)” rating in a research report on Monday, May 11th. Finally, Wells Fargo & Company upped their target price on shares of Lincoln National from $44.00 to $47.00 and gave the stock an “overweight” rating in a research note on Thursday, July 9th. Six equities research analysts have rated the stock with a Buy rating, eight have assigned a Hold rating and two have assigned a Sell rating to the company’s stock. According to MarketBeat.com, the company currently has an average rating of “Hold” and an average price target of $45.93.

Insider Transactions at Lincoln National

In other Lincoln National news, EVP Craigt T. Beazer sold 30,000 shares of Lincoln National stock in a transaction dated Friday, June 5th. The stock was sold at an average price of $34.45, for a total transaction of $1,033,500.00. Following the completion of the sale, the executive vice president directly owned 103,906 shares of the company’s stock, valued at $3,579,561.70. The trade was a 22.40% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. 1.03% of the stock is owned by company insiders.

Institutional Inflows and Outflows

A number of hedge funds have recently made changes to their positions in the business. JPL Wealth Management LLC purchased a new stake in Lincoln National during the third quarter worth approximately $29,000. Transamerica Financial Advisors LLC purchased a new position in Lincoln National in the fourth quarter valued at approximately $32,000. Los Angeles Capital Management LLC acquired a new stake in Lincoln National during the fourth quarter worth approximately $34,000. Larson Financial Group LLC raised its holdings in Lincoln National by 61.8% during the third quarter. Larson Financial Group LLC now owns 1,024 shares of the financial services provider’s stock worth $41,000 after purchasing an additional 391 shares in the last quarter. Finally, EverSource Wealth Advisors LLC raised its holdings in Lincoln National by 57.2% during the second quarter. EverSource Wealth Advisors LLC now owns 1,526 shares of the financial services provider’s stock worth $53,000 after purchasing an additional 555 shares in the last quarter. Hedge funds and other institutional investors own 72.81% of the company’s stock.

Lincoln National Company Profile

Lincoln National Corporation, doing business as Lincoln Financial Group, is a diversified financial services holding company focused on providing retirement, insurance, and wealth management solutions in the United States and select international markets. Headquartered in Radnor, Pennsylvania, the company operates through several business segments, including Retirement Plan Services, Life Insurance, and Group Protection. Its offerings are designed to help individuals, families, and institutions plan and prepare for their financial futures.

The Retirement Plan Services segment delivers recordkeeping, administrative services, and investment management for defined contribution and defined benefit plans.