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Primerica (PRI) Beats Q3 Earnings On Improved Term Life

Published 11/13/2016, 08:32 PM
Updated 07/09/2023, 06:31 AM

Primerica, Inc. (NYSE:PRI) reported third-quarter 2016 operating income of $1.22 per share, which surpassed the Zacks Consensus Estimate of $1.33 by nearly 8%. Also, the bottom line improved 24.5% year over year.

Operational Update

Revenues grew 7.8% year over year to $383.7 million on higher net premiums, commissions and fees, and net investment income. Revenues outpaced the Zacks Estimates Consensus of $378 million.

While Term Life Insurance revenues increased 13%, Investment and Savings Products revenues inched up 1%. Corporate and Other Distributed Products revenues improved 3% year over year.

Life Licensed Sales Force was $115.3 million at the end of the third quarter, up 10% year over year.

Total benefits and expenses of $295.2 million were up 5.1 % year over year due to higher benefits and claims, insurance expenses, insurance commissions, and other operating expenses.

Operating income jumped 18% year over year on 25% higher operating income at Term Life Insurance and 3% growth at Investment and Savings Products, partially offset by an 11% decline at Corporate and Other Distributed Products.

Financial Update

Cash and cash equivalents was $195.3 million as of Sep 30, 2016 compared with $152.3 million as of Dec 31, 2015.

Total investments were $2.3 billion compared with $2.2 billion at year-end 2015.

Notes payable were $372.8 million as against $372.6 million at year-end 2015.

Adjusted stockholders' equity totaled $1.15 billion compared with $1.11 billion as of Dec 31, 2016.

Primerica Life Insurance Company’s statutory risk-based capital (RBC) ratio was about 430% as of Sep 30, 2016.

Return on equity expanded 230 basis points to 19.1%.

Share Repurchase Update

Primerica spent $41.0 million to buy back 0.7 million shares in the quarter. This took the year-to-date tally to 2.7 million shares repurchased for $131.5 million.

PRIMERICA INC Price, Consensus and EPS Surprise

PRIMERICA INC Price, Consensus and EPS Surprise | PRIMERICA INC Quote

Zacks Rank and Performance of Other Life Insurers

Currently, Primerica holds a Zacks Rank #2 (Buy). Earnings of Torchmark Corp. (NYSE:TMK) and Reinsurance Group of America Inc. (NYSE:RGA) beat their respective Zacks Consensus Estimate, while that of Genworth Financial Inc. (NYSE:GNW) missed our expectations in the third quarter. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

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PRIMERICA INC (PRI): Free Stock Analysis Report

TORCHMARK CORP (TMK): Free Stock Analysis Report

REINSURANCE GRP (RGA): Free Stock Analysis Report

GENWORTH FINL (GNW): Free Stock Analysis Report

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