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Voya (VOYA) Up 1.2% Since Last Earnings Report: Can It Continue?

Zacks Equity Research

A month has gone by since the last earnings report for Voya Financial (VOYA). Shares have added about 1.2% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Voya due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Voya Financial Q1 Earnings Lag Estimates, Rise Y/Y

Voya Financial, Inc.’ first-quarter 2019 net operating income of $1.07 per share missed the Zacks Consensus Estimate by 5.3% due to lower revenues. However, the bottom line improved 23% year over year.

The company’s revenues of $1.4 billion decreased 20% from the year-ago quarter.

Assets under management and administration were $547 billion as of Mar 31, 2019.

Segmental Update

Retirement’s adjusted operating earnings of $129 million increased 18.3% year over year on the back ofpositive DAC/VOBA and other intangibles, lower fee-based margin owing to low average asset balances, etc.
Investment Management posted adjusted operating earnings of $34 million and generated $1.1 billion of Institutional net flows, reflecting strong commercial growth in the business and the 13th straight quarter of positive institutional net flows.

Employee Benefits’ adjusted operating earnings were $38 million, up 19% year over year on the back of an improved loss ratio for Stop Loss and a rise in the Voluntary block.

Individual Life’s adjusted operating earnings were $48 million, up 182.4%year over year.

Corporate incurred adjusted operating losses of $55 million, narrower than the year-ago quarterly losses of $56 million owing to a decrease in the standard costs on account of its sale of substantially all its individual annuities businesses.

Financial Update

Voya Financial exited the first quarter with $705 million in excess capital.
In the quarter under review, the company completed its $250-million accelerated share repurchase deal and entered into a new $236-million accelerated share repurchase agreement.

Its board of directors also announced $500 million worth of an additional share buyback, which expires on Jun 30, 2020.

The company is intended to hike its common stock dividend to a minimum yield of 1% in the beginning of third-quarter 2019.


How Have Estimates Been Moving Since Then?

It turns out, fresh estimates flatlined during the past month.

VGM Scores

Currently, Voya has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.


Voya has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

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