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CNO Financial (CNO) Misses on Earnings, Beats Revenues in Q4

CNO Financial Group, Inc .'s CNO fourth-quarter 2016 net operating earnings of 35 cents per share missed the Zacks Consensus Estimate of 39 cents by 10.2%. The bottom line also decreased 8% year over year.

For 2016, the company reported net operating income per diluted share of $1.47, up 4.2% from 2015.

CNO Financial's fourth-quarter total revenue increased 3.5% year over year to $1 billion. The top line also surpassed the Zacks Consensus Estimate of $964 million by 4%.

For 2016, the company reported total revenue of $3.98 billion, up 4.5% year over year.

For the fourth quarter, total new annualized premiums dipped 4% year over year to $106.7 million.

Quarterly Segment Update

Bankers Life

New annualized premiums decreased 6% year over year to $65 million, down due to lower sales of Medicare supplement and life products . Pre-tax operating earnings of $138.9 million rose 15% year over year due to positive comprehensive annual actuarial review, including the net impact of changes to spread and persistency assumptions related to fixed index annuities.

WashingtonNational

New Annualized premiums grew 3% year over year to $27 million due to higher sales of supplemental health products . Pre-tax operating earnings in the reported quarter plunged by $2.4 million from the prior-year quarter due to the absence of positive comprehensive annual actuarial review, including the net impact of changes to spread and persistency assumptions related to fixed index annuities in 2016.

Colonial Penn

New Annualized premiums was $14.7 million, down 6% year over year. The downside reflectslower lead volume, primarily due to reduced television advertising as a result of the elections. Pre-tax operating earnings were down by $2.1 million year over year to $4.6 million, primarily due to loss recognition on a closed block of payout annuities resulting from changes in long-term interest rates and mortality assumptions.

Corporate Operations

The segment includes investment advisory subsidiary and corporate expenses. Pre-tax losses were $23 million, about 228% wider than a loss of $7 million the year-ago quarter owing to less favorable investment returns and higher expenses.

Financial Update

Unrestricted cash and investments held by CNO Financial'sholding company were $264 million at Dec 31, 2016, compared with $189 million at Sep 30, 2016.

Book value per diluted share, excluding accumulated other comprehensive income, increased to $22.02 from $20.05 in the prior-year quarter.

Consolidated risk-based capital ratio was estimated at 459% as of Dec 31, 2016. This, reflects estimated statutory operating earnings of $286 million compared with 449% as of Dec 31, 2015.

Securities Repurchase and Divided Update

During 2016, CNO Financial repurchased shares worth $203 million and paid dividends of $55 million.

CNO Financial Group, Inc. Price, Consensus and EPS Surprise

CNO Financial Group, Inc. Price, Consensus and EPS Surprise | CNO Financial Group, Inc. Quote

Zacks Rank and Performance of Other Multiline Insurers

CNO Financial 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 Insurers

Among the other players from the insurance industry that have reported their fourth-quarter earnings so far, the bottom line at Brown & Brown Inc. BRO , MGIC Investment Corporation MTG and The Travelers Companies, Inc. TRV beat their respective Zacks Consensus Estimate.

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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.

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