American Equity Investment Life Holding Company 's AEL third-quarter 2018 net operating income of $1.87 per share beat the Zacks Consensus Estimate of 87 cents per share. The bottom line also soared nearly 94.8% year over year.
American Equity Investment Life Holding Company Price, Consensus and EPS Surprise
American Equity Investment Life Holding Company Price, Consensus and EPS Surprise | American Equity Investment Life Holding Company Quote
Including one-time items, net income increased a whopping 193.6% year over year to $1.85 per share.
Behind the Third-Quarter Headlines
The company's total revenues of $614.9 million grew 9.7% from the year-ago quarter owing to higher premiums and other considerations, annuity product charges as well as net investment income.
Net investment income improved 9.8% year over year to $549.4 million.
Total benefits and expenses increased 20.4% year over year to $986.1 million due to increase in amortization of deferred sales inducements, change in fair value of embedded derivatives, interest expense on subordinated debentures, amortization of deferred policy acquisition costs as well as other operating costs and expenses.
Estimated risk-based capital ratio of 386% expanded 1100 basis points (bps) from the year-ago quarter.
Investment spread in the third quarter stood at 2.67% down 3 bps from the prior-year quarter.
In the reported quarter, annuity sales of $1 billion increased 11.1% from the year-earlier period.
Policyholder funds under management as of Sep 30, 2018 came in at $50.6 billion, up 6.3% from the year-ago period.
As of Sep 30, 2018, total assets were $63.4 billion, up 2.3% from the level at year-end 2017.
Cash and cash equivalents at the reviewed quarter-end declined 21.3% from the 2017-end level to $1.1 billion.
Shareholders' equity as of Sep 30, 2018 decreased 12.7% year over year to $2.5 billion.
American Equity reported book value per share (excluding AOCI) of $26.80, up 13.4% year over year.
American Equity carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
Performance of Other Insurers
Among other players from the insurance industry having reported third-quarter earnings so far, the bottom line of The Progressive Corporation PGR and MGIC Investment Corporation MTG outpaced the respective Zacks Consensus Estimate while that of RLI Corp. RLI fell shy of the same.
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free reportAmerican Equity Investment Life Holding Company (AEL): Free Stock Analysis ReportMGIC Investment Corporation (MTG): Free Stock Analysis ReportThe Progressive Corporation (PGR): Free Stock Analysis ReportRLI Corp. (RLI): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research