Unum Group UNM is slated to report third-quarter 2024 earnings on Oct. 29, after market close. The insurer’s earnings beat estimates in three of the last four reported quarters and missed in one.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

Factors to Note

Premium in the third quarter is likely to have benefited from favorable persistency and higher prior period sales in each of the principal operating segments. The Zacks Consensus Estimate is pegged at $2.6 billion, indicating an increase of 4.6% from the year-ago reported figure. We expect premium income to be $2.6 billion, suggesting an increase of 4.2% from the year-ago quarter.

Higher miscellaneous investment income and an increase in the level of invested assets are likely to have supported higher net investment income. The upside is likely to have been partially offset by lower investment income from inflation index-linked bonds held by Unum UK. Our estimate is pegged at $517.5 million. The Zacks Consensus Estimate is pegged at $534 million. 

Improved premiums and an increase in net investment income are likely to have aided top-line growth. The Zacks Consensus Estimate for the top line is pegged at $3.2 billion, suggesting an increase of 4% from the year-ago number.

The performance of Unum U.S. and Colonial Life, two of the largest operating segments, is likely to have been driven by higher premium income, higher prior period sales, favorable persistency, favorable benefit experience in the life and accident, sickness, and disability product lines, favorable recoveries in the long-term disability product line and favorable stop loss experience. Our estimate for Unum US operating revenues is pegged at $1.9 billion, while the same for Colonial Life is $478.3 million.

Unum International is likely to have benefited from in-force block growth, favorable recoveries in the group long-term disability product line, higher premium income and favorable benefits experience, increased Unum International sales and Unum UK sales and higher persistency. Our estimate for the segment’s operating revenues is pegged at $261.5 million.

Expenses are likely to have increased because of higher policy benefits, commissions, interest and debt expense, amortization of deferred acquisition costs and other expenses. We expect total benefits and expenses to be $2.7 billion.

Continued share buybacks are likely to have provided a boost to the bottom line.

The Zacks Consensus Estimate for earnings per share is pegged at 2.08, indicating a decrease of 7.2% from the year-ago reported figure.

Quantitative Model Prediction

Our proven model predicts an earnings beat for Unum Group this time around. This is because a stock needs to have the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) that increases the odds of an earnings beat. 

Earnings ESP: It has an Earnings ESP of +0.52%. This is because the Most Accurate Estimate of $2.10 is pegged higher than the Zacks Consensus Estimate of $2.08. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Unum Group currently carries a Zacks Rank #3.

Other Stocks to Consider

Some other insurance stocks with the right combination of elements to deliver an earnings beat this time around are:

Willis Towers Watson Public Limited Company WTW has an Earnings ESP of +2.09% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for third-quarter 2024 earnings is pegged at $2.68, indicating a year-over-year increase of 19.6%. You can see the complete list of today’s Zacks #1 Rank stocks here.

WTW’s earnings beat estimates in each of the last four reported quarters.

Aflac Incorporated AFL has an Earnings ESP of +0.66% and carries a Zacks Rank of 3 at present. The Zacks Consensus Estimate for third-quarter 2024 earnings is pegged at $1.69, implying an increase of 8.1% from the year-ago reported figure.

AFL’s earnings beat estimates in three of the last four reported quarters while missing in the other one.

Trupanion, Inc. TRUP has an Earnings ESP of +44.74% and carries a Zacks Rank of 3 at present. The Zacks Consensus Estimate for third-quarter 2024 earnings is pegged at a loss of 6 cents, implying an increase of 40% from the year-ago reported figure.

TRUP’s earnings beat estimates in each of the last four reported quarters.

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

Aflac Incorporated (AFL) : Free Stock Analysis Report

Unum Group (UNM) : Free Stock Analysis Report

Willis Towers Watson Public Limited Company (WTW) : Free Stock Analysis Report

Trupanion, Inc. (TRUP) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research