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Voya Financial's (VOYA) Q3 Earnings, Revenues Miss Estimates

Zacks Equity Research

Voya Financial, Inc.’s VOYA third-quarter 2019 net operating income of $1.36 per share missed the Zacks Consensus Estimate by 2.9%. However, the bottom line improved 1.5% year over year.

The company’s revenues of $187 billion increased 14.7% from the year-ago quarter. However, the top line missed the Zacks Consensus Estimate by 37.9%.

Assets under management and administration were $568 billion as of Sep 30, 2019.

Voya Financial, Inc. Price, Consensus and EPS Surprise

Voya Financial, Inc. Price, Consensus and EPS Surprise

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

Segmental Update

Retirement’s adjusted operating earnings of $117 million decreased 53.7% year over year due to negative DAC/VOBA and other intangibles unlocking, lower investment income and higher administrative expenses.

Investment Management posted adjusted operating earnings of $46 million, down 4.2% year over year due to higher fee-based margin driven by higher Institutional fees from positive net flows and lower investment capital revenues.

It generated $332 million of institutional net flows, reflecting strong commercial growth in the business and recorded the 15th straight quarter of positive institutional net flows.

Employee Benefits’ adjusted operating earnings were $57 million, up 14% year over year on the back of higher underwriting results primarily driven by growth in the Voluntary block as well as improvement in the loss ratio for Group Life and higher administrative expenses.

Individual Life’s adjusted operating losses were $33 million, narrower than the year-ago quarterly loss of $134 million due to lower negative DAC/VOBA and other intangibles unlocking.

Corporate incurred adjusted operating losses of $62 million, wider than the year-ago quarterly loss of $54 million. The year-ago quarter gained from higher positive DAC/VOBA and other intangible unlocking.

Share Repurchase and Dividend Update

In the third quarter of 2019, Voya repurchased shares worth $290 million. Its board of directors also authorized the repurchase of shares worth $800 million set to expire on Dec 31, 2020.

The company hiked its dividend to 15 cents, up from the prior payout of 1 cent. This is in line with the company's plan to increase the dividend yield to at least 1%.

Financial Update

Voya Financial exited the third quarter with $471 million in excess capital.

Zacks Rank

Voya Financial currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Insurance Releases

Of the insurance industry players that have reported third-quarter results so far, Reinsurance Group of America RGA, Brighthouse Financial Inc. BHF and CNA Financial Corporation CNA beat the respective Zacks Consensus Estimate for earnings.

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