Aviva (AVVIY) could be a solid addition to your portfolio given its recent upgrade to a Zacks Rank #1 (Strong Buy). An upward trend in earnings estimates -- one of the most powerful forces impacting stock prices -- has triggered this rating change.The Zacks rating relies solely on a company's changing earnings picture. It tracks EPS estimates for the current and following years from the sell-side analysts covering the stock through a consensus measure -- the Zacks Consensus Estimate.Since a changing earning ...

Industry Overview - The Zacks Life Insurance industry includes companies providing life insurance coverage and retirement benefits, with products such as annuities, whole and term life insurance, and health insurance [2] - The life insurance market is projected to grow, with gross written premiums expected to reach $1.34 trillion by 2025, driven by increasing demand for protection products and retirement benefits due to a rising number of baby boomers [2] - The industry is experiencing accelerated technology adoption, although rising mortality trends may impact profitability [2] Trends Impacting the Industry - The Federal Reserve has lowered interest rates by 25 basis points to a range of 4%-4.25%, with indications of further cuts, which may challenge life insurers as they invest premiums to meet guaranteed obligations [3][4] - Life insurance sales are expected to grow by 2%-6% in 2025, with new annualized premium growth across various life insurance products [3] - Insurers are redesigning products to focus on bundled covers that provide living benefits, reflecting customer preferences [4] Technological Advancements - The U.S. life insurance market is shifting towards digital platforms, with insurers leveraging AI and machine learning for customized coverages and premium calculations [5] - Increased automation is anticipated to enhance premium growth and operational efficiency, while also helping to manage costs [5] Industry Performance - The Zacks Life Insurance industry currently holds a Zacks Industry Rank of 73, placing it in the top 30% of 255 Zacks industries, indicating strong near-term prospects [7][8] - Year-to-date, the Life Insurance industry has underperformed compared to the Finance sector and the S&P 500, with a collective gain of 0.1% against 14.7% and 13.8% respectively [9] Valuation Metrics - The industry is trading at a trailing 12-month price-to-book (P/B) ratio of 1.91X, compared to the S&P 500's 8.7X and the Finance sector's 4.36X [11] Company Highlights - **Aviva**: Expected earnings growth of 23.6% and 13.2% for 2025 and 2026 respectively, with a strong performance across all business lines [16][17] - **Primerica**: Anticipated earnings growth of 8.1% and 8.5% for 2025 and 2026, benefiting from strong demand for protection products [20][21] - **Lincoln Financial**: Projected earnings growth of 5.8% and 3.2% for 2025 and 2026, supported by a recovering Group Protection business [24][25] - **Voya Financial**: Expected earnings growth of 26.3% for 2025, driven by a focus on high-growth, capital-light businesses [28][29] - **Jackson Financial**: Anticipated earnings growth of 8.8% and 8.6% for 2025 and 2026, with a strong focus on diversified product sales [32][33]

Company Performance - Morgan Stanley (MS) has returned 17.4% year-to-date, outperforming the average return of 11.8% for Finance companies [4] - The Zacks Consensus Estimate for Morgan Stanley's full-year earnings has increased by 2.8% over the past three months, indicating improved analyst sentiment and earnings outlook [3] Industry Comparison - Morgan Stanley is part of the Financial - Investment Bank industry, which has an average year-to-date return of 23.1%, suggesting that MS is slightly underperforming its industry [5] - In contrast, Aviva (AVVIY) has significantly outperformed both the Finance sector and its own industry, returning 57.1% year-to-date [4][6] Sector Ranking - The Finance sector, which includes 869 individual stocks, currently holds a Zacks Sector Rank of 2, indicating strong performance relative to other sectors [2] - Morgan Stanley has a Zacks Rank of 2 (Buy), reflecting its favorable position within the Finance sector [3]

Core Viewpoint - Aviva (AVVIY) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook based on rising earnings estimates, which are crucial for stock price movements [1][3]. Earnings Estimates and Stock Performance - The Zacks rating system emphasizes the importance of earnings estimate revisions, which have a strong correlation with near-term stock price movements [4][6]. - For Aviva, the Zacks Consensus Estimate for earnings per share (EPS) for the fiscal year ending December 2025 is projected at $1.38, showing no year-over-year change, but estimates have increased by 4.2% over the past three months [8]. Zacks Rating System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) stocks historically generating an average annual return of +25% since 1988 [7]. - Aviva's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [10].

Company Performance - Aviva (AVVIY) has gained approximately 43.5% year-to-date, significantly outperforming the average return of 9.9% for Finance companies [4] - The Zacks Consensus Estimate for Aviva's full-year earnings has increased by 4.2% over the past quarter, indicating improving analyst sentiment and a positive earnings outlook [3] Industry Comparison - Aviva is part of the Insurance - Life Insurance industry, which consists of 16 companies and currently ranks 77 in the Zacks Industry Rank. This industry has an average gain of 3.7% year-to-date, showing that Aviva is performing better than its peers [5] - In contrast, Northern Trust Corporation, another strong performer in the Finance sector, belongs to the Banks - Major Regional industry, which has 10 stocks and is ranked 38, with a year-to-date gain of 7.2% [6]

Group 1 - EPR Properties is a notable stock within the Finance sector, currently ranked 5 among 16 groups in the Zacks Sector Rank [2] - The Zacks Rank system indicates that EPR Properties has a ranking of 2 (Buy), suggesting a favorable outlook for the stock [3] - EPR Properties has seen a year-to-date gain of approximately 27.7%, significantly outperforming the average Finance sector return of 4.4% [4] Group 2 - EPR Properties is categorized under the REIT and Equity Trust - Retail industry, which ranks 91 among 21 stocks in the Zacks Industry Rank [6] - The REIT and Equity Trust - Retail industry has experienced a decline of about 5.6% year-to-date, indicating that EPR Properties is performing better than its peers in this specific industry [6] - Another Finance stock, Aviva, has also outperformed the sector with a year-to-date increase of 40.8% and is categorized under the Insurance - Life Insurance industry, which ranks 71 [5][7]

Group 1 - The article emphasizes the importance of fundamental, income-oriented, long-term analysis conducted by buy-side hedge professionals across various sectors in developed markets globally [1] - It invites readers to engage in discussions regarding investment ideas, highlighting a collaborative approach to investment analysis [1] Group 2 - The article does not provide specific stock recommendations or investment advice, maintaining a neutral stance on the suitability of investments for individual investors [2][3] - It clarifies that the author has no current positions in any mentioned companies and does not plan to initiate any within the next 72 hours, ensuring transparency in the analysis [2]

Group 1 - Aviva is highlighted as an attractive income investment in the European insurance sector due to its high-dividend yield [1] - The author has extensive experience in the financial markets, specifically in portfolio management and analysis [1] Group 2 - No stock or derivative positions are held by the author in any mentioned companies, nor are there plans to initiate such positions [2] - The article reflects the author's personal opinions and is not influenced by compensation from any company [2]

Core Insights - EPR Properties is currently outperforming the Finance sector, with a year-to-date gain of approximately 24.8% compared to the sector's average return of 5.3% [4] - The Zacks Rank for EPR Properties is 2 (Buy), indicating a positive earnings outlook and improving analyst sentiment [3] - EPR Properties is part of the REIT and Equity Trust - Retail industry, which has seen an average loss of 5.1% this year, further highlighting EPR's strong performance [6] Company Performance - The Zacks Consensus Estimate for EPR's full-year earnings has increased by 1.5% over the past quarter, reflecting a positive trend in earnings outlook [4] - EPR Properties is ranked 87 in the Zacks Industry Rank, indicating its relative strength within its industry [6] Comparison with Peers - Aviva has also outperformed the Finance sector with a year-to-date return of 41.5% and a Zacks Rank of 1 (Strong Buy) [5] - The Insurance - Life Insurance industry, to which Aviva belongs, is currently ranked 134 and has seen a modest increase of 1.3% this year [6]

Group 1 - GDS Holdings Limited (GDS), a data center operator from China, has seen a 12.5% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - monday.com Ltd. (MNDY), a software applications company, has experienced a 6.5% increase in the Zacks Consensus Estimate for its next year earnings over the last 60 days [1] - Kinross Gold Corporation (KGC), a gold-mining company, has seen a significant 41.1% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [2] - Healthcare Services Group, Inc. (HCSG), which provides management, administrative, and operating services, has seen a 7.1% increase in the Zacks Consensus Estimate for its next year earnings over the last 60 days [2] - Aviva plc (AVVIY), an insurance, retirement, and wealth products company, has seen a 3% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [3]