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Fidelity National (FNF) Q4 Earnings Beat, Revenues Miss

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·4 min read
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Fidelity National Financial, Inc. FNF reported fourth-quarter 2021 operating income per share of $2.16, which outpaced the Zacks Consensus Estimate by 35%. The bottom line increased 7.5% on a year-over-year basis.

Results gained on the back of growth in revenues and strong performances across its Title and F&G segments. However, the upside was partly offset by elevated expenses.

Fidelity National Financial, Inc. Price, Consensus and EPS Surprise

Fidelity National Financial, Inc. Price, Consensus and EPS Surprise
Fidelity National Financial, Inc. Price, Consensus and EPS Surprise

Fidelity National Financial, Inc. price-consensus-eps-surprise-chart | Fidelity National Financial, Inc. Quote

Behind the Headlines

Operating revenues increased 16% year over year to $3.2 billion in the quarter, attributable to improved title and escrow revenues coupled with higher interest and investment income. The top line however missed the Zacks Consensus Estimate of $3.4 billion.

Interest and investment income of $537 million increased 49.5% year over year.

Total expenses increased 44.7% year over year to $4.1 billion due to escalated personnel costs, agent commissions, other operating expenses, depreciation and amortization, claims loss expense and interest expense.

Segment Results

Total revenues at Title climbed 16.1% year over year to $3.2 billion. While direct title premiums improved 21.3% year over year to $1 billion in the quarter, agency title premiums surged 22.5% year over year to $1.4 billion. Also, escrow, title-related and other fees of $795 million climbed 2.6% year over year in the quarter under review.

Adjusted pre-tax title margin came in at 22.4%, which expanded 30 basis points (bps) year over year due to contraction in refinance volumes.

On a daily basis, while refinance orders opened declined 44% year over year, refinance orders closed declined 39% year over year. Purchase orders opened and purchase orders closed increased 2% and 4%, respectively, year over year on a daily basis. However, the total fee per file for the quarter increased 43% year over year to $3,023 during the quarter.

Total revenues at F&G were $1.3 million during the quarter, up more than a three-fold year over year. Total retail annuity sales climbed 5% year over year to $1.4 billion, while fixed indexed annuities (FIA) sales of $1.1 billion grew 11.4% year over year in the quarter.

Average assets under management (AUM) amounted to $35.7 billion at quarter-end, up 28% from the fourth-quarter 2020 figure attributable to net new business asset flows.

Financial Update

Fidelity National exited 2021 with a cash and investment portfolio of $47.2 billion, up 24.8% from the 2020-end level. As of Dec 31, 2021, notes payable increased 16.3% to $3.1 billion from the figure at 2020 end.

Stockholders’ equity of $9.4 billion increased 12.7%% from the figure as of Dec 31, 2020.

In 2021, Fidelity National bought back 10.2 shares worth $461 million.

Zacks Rank

Fidelity National 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 Property & Casualty Insurers

Of the insurance industry players that have reported fourth-quarter results so far, The Travelers Companies TRV, RenaissanceRe Holdings Ltd. RNR and The Progressive Corporation PGR beat the Zacks Consensus Estimate for earnings.

Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and increased 6% year over year. Total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion.

Travelers’ net written premiums increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 bps year over year to 88.

RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from the year-ago loss of $1.59 per share. Total revenues of $1.39 billion dipped 0.1% year over year.

RenaissanceRe’s gross premiums written surged 40.4% year over year to $1.3 billion. The combined ratio improved 3530 bps year over year to 79.4.

Progressive’s earnings per share of $1.05 beat the Zacks Consensus Estimate of 99 cents but declined 43.2% from the year-ago quarter.

Progressive’s net premiums written were $10.7 billion in the quarter, up 13% from $9.5 billion a year ago. The combined ratio deteriorated 630 bps from the prior-year quarter to 94.7.


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