Core Viewpoint - Unum Group's recent earnings report showed mixed results, with operating net income missing estimates but demonstrating year-over-year growth, indicating both challenges and opportunities for the company moving forward [2][3]. Operational Update - Unum Group reported total operating revenues of $3.2 billion, a 2.5% increase year over year, but missed the consensus estimate by 1.5% [3] - Premium income rose 3.1% to $2.6 billion, aligning with the Zacks Consensus Estimate [3] - Net investment income increased by 2.4% to $543.6 million, surpassing the consensus estimate of $540 million [3] Segment Performance - Unum U.S. reported premium income of $1.7 billion, up 3% year over year, but adjusted operating income decreased by 2.6% to $333.2 million, missing the consensus estimate of $346 million [5] - Unum International saw premium income rise 17.1% to $246.6 million, with adjusted operating income increasing by 4.6% to $37.6 million, though it fell short of the $42 million estimate [5] - The Unum U.K. segment reported premium income of £156.9 million, a 5.2% increase, with adjusted operating income rising 10.7% to £27.6 million [6] Financial Metrics - The benefit ratio, excluding reserve assumption updates, deteriorated by 420 basis points to 72.1% due to unfavorable claims in certain product lines [7] - For 2024, persistency decreased in some product lines but increased in group life [8] - Colonial Life's premium income increased 3.2% to $448.9 million, supported by stable persistency [8] Full-Year Highlights - Adjusted operating income for the full year was $8.44 per share, a 10.1% increase from 2023 [12] - Total premium increased by 4.5% to $10.5 billion [12] Capital Management - As of December 31, 2024, the risk-based capital ratio for Unum's traditional U.S. insurance companies was approximately 430% [13] - The company had holding company liquidity of $2 billion and executed accelerated share repurchase agreements totaling $471 million in Q4 [13] - Book value per share grew 23% year over year to $61.38 [13] Guidance - Unum expects after-tax adjusted operating income per share to grow by 8-12% in 2025, with core operations premium growth projected between 4% and 7% [14] Market Outlook - Estimates for Unum have trended upward recently, indicating a positive outlook for the stock [15][17] - The stock holds a Zacks Rank 3 (Hold), suggesting an expectation of in-line returns in the coming months [17]
Unum (UNM) Up 4.6% Since Last Earnings Report: Can It Continue?