Brighthouse Financial (BHF) Q2 Earnings Miss, Revenues Top

A generic image of money and a calculator
Credit: Shutterstock photo

Brighthouse FinancialInc .'s BHF second-quarter 2018 adjusted net income of $1.27 per share missed the Zacks Consensus Estimate of $2.03 by 37.4%.

Brighthouse Financial, Inc. Price, Consensus and EPS Surprise

Brighthouse Financial, Inc. Price, Consensus and EPS Surprise | Brighthouse Financial, Inc. Quote

Increase in corporate expenses and unfavorable results in the Run-off segment resulted in the underperformance.

Net loss came in at $2.01 per share in the reported quarter.

Behind the Headlines

Total revenues of $2.1 billion surpassed the Zacks Consensus Estimate by 1.1%. However, the top line dipped 0.7% year over year.

Premiums of $223 million increased 2.3% year over year. Annuity sales improved 42% year over year on increase in sales of Shield and fixed indexed annuities.Net investment income was $806 million in the reported quarter, up 5.2% year over year. The improvement was fueled by growth in assets and the ongoing repositioning of the investment portfolio, partially offset by lower alternative investment income. Investment income yield was 4.4%.

Corporate expenses of $288 million pretax increased from $230 million pretax in the first quarter of 2018. Brighthouse Financial expects corporate expenses in the first year post-separation between $1 and $1.1 billion.

Total expenses rose 18.5% year over year on higher interest credited to policyholder account balances, Policyholder benefits plus claims and other expenses.

Quarterly Segment Update

Annuities reported adjusted operating income of $221 million, down 2.2% year over year on escalated expenses.

Life reported adjusted operating income of $37 million, skyrocketing 208% year over year. This improvement stemmed from better net investment income owing to portfolio realignment completed in the first quarter of 2018, partially offset by higher DAC amortization and higher expenses.

Adjusted operating loss in Run-off was $6 million on higher claims and reserve development plus lower net investment income against income of $52 million in the year-ago quarter.

Adjusted operating loss at Corporate & Other was $99 million due to lower net investment income and higher expenses versus $34 million income in the prior-year quarter.

Financial Update

Cash and cash equivalents were $2.1 billion, down 51.9% year over year.

Shareholders' equity of $13.4 billion at the quarter-end decreased 18.2% year over year.

Book value per share was $105.37 as of Jun 30, 2018.


Brighthouse Financial continues to estimate adjusted earnings per share between $8.50 and $9.00 in 2018. Adjusted return on equity is expected about 8%.

Share Buyback Program

Brighthouse Financial's board of directors a $200-million worth repurchase of shares.

Zacks Rank

Brighthouse Financial 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 Insurers

Among other players from the insurance industry having already reported second-quarter earnings, the bottom line of The Progressive Corporation PGR , MGIC Investment Corporation MTG and RLI Corp. RLI surpassed the respective Zacks Consensus Estimate.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>

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 report

MGIC Investment Corporation (MTG): Free Stock Analysis Report

RLI Corp. (RLI): Free Stock Analysis Report

The Progressive Corporation (PGR): Free Stock Analysis Report

Brighthouse Financial, Inc. (BHF): Free Stock Analysis Report

To read this article on click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story


Other Topics

Earnings Stocks

Latest Markets Videos


    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at

    Learn More