Reasons Why Investors Should Retain Unum Group (UNM) Now

Core Viewpoint - Unum Group (UNM) is favored by investors due to favorable sales trends, strong persistency, an improving rate environment, and a solid capital position [1] Financial Performance - The Zacks Consensus Estimate for Unum Group's 2024 earnings per share indicates a 9.2% increase from the previous year, with revenues projected at $12.96 billion, reflecting a 4.3% year-over-year improvement [2] - Earnings have grown by 9% over the past five years, outperforming the industry average of 3.8% [3] - Unum Group has a decent earnings surprise history, beating estimates in three of the last four quarters with an average beat of 2.96% [4] Estimate Revisions - The Zacks Consensus Estimate for 2024 and 2025 earnings has increased by 1.4% and 1.6%, respectively, in the past 30 days, boosting investor confidence [5] Stock Performance - UNM currently holds a Zacks Rank 3 (Hold) and has gained 17.4% year-to-date, compared to the industry's growth of 18.6% [6] Operational Efficiency - In Q2 2024, Unum Group's trailing 12-month Return on Equity (ROE) expanded by 30 basis points year-over-year to 15.6%, indicating efficient use of shareholders' funds [9] - The Return on Invested Capital (ROIC) for the trailing 12 months was 9.2%, surpassing the industry average of 7.9% [9] Business Growth Drivers - Unum Group expects sales growth of 7-10% and premium growth of 5-7% in 2024, with long-term projections of 8-12% sales growth and 4-7% premium growth [10] - The operational excellence of Unum U.S. and Colonial Life, along with strong persistency and new product line growth, is expected to drive performance [11] Capital Management - Unum Group has increased dividends 13 times in the last 12 years, with a recent 15% hike, bringing the dividend payout ratio to around 20% [13] - The company plans to repurchase $500 million worth of shares in 2024 and anticipates annual dividend hikes of 10-15% over the next five years [13]