Sun Life (SLF) Q3 Earnings Surpass Estimates

Sun Life Financial Inc. (SLF) reported its quarterly earnings for the period ending in September 2024, showcasing a solid performance. The company announced earnings of $1.29 per share, which exceeded the Zacks Consensus Estimate of $1.25 per share. This marks an improvement compared to earnings of $1.19 per share reported in the same quarter last year. It's worth noting that these earnings are adjusted for any non-recurring items.

This quarterly result demonstrates an earnings surprise of 3.20%. In the prior quarter, forecasts suggested that the company would report earnings of $1.18 per share, while it ultimately delivered $1.25, resulting in an even larger surprise of 5.93%.

Over the last year, Sun Life has managed to beat consensus earnings per share (EPS) estimates three times out of the last four quarters.

Meanwhile, the firm reported revenues of $6.29 billion for the quarter, which fell short of the Zacks Consensus Estimate by 5.19%. This figure represents a significant increase from last year's revenues of $1.82 billion. Notably, the company has struggled to surpass consensus revenue estimates during the previous four quarters.

The future movements in the stock price based on these recent results and future earnings expectations will largely hinge on management's insights during the earnings call.

Since the start of the year, Sun Life shares have increased by 7.2%, which is notably less than the S&P 500's growth of 20.1% in the same period.

What Lies Ahead for Sun Life?

With Sun Life's performance lagging behind the market this year, many investors may be pondering the future trajectory of the stock.

While no straightforward answers exist, one critical factor that could guide investor sentiment is the company's earnings outlook. This outlook includes not only the current consensus earnings expectations for upcoming quarters but also any recent adjustments to these expectations.

Research has shown a strong connection between short-term stock movements and trends in earnings estimate revisions. Investors can monitor these revisions independently or utilize a reliable rating tool like the Zacks Rank, known for effectively predicting stock performance based on earnings estimate trends.

Prior to this earnings announcement, the trend in estimate revisions for Sun Life appeared mixed. Although the recent earnings report may alter the magnitude and direction of these revisions, the current ranking indicates a Zacks Rank of #3 (Hold) for the stock. This suggests that the shares are likely to perform in line with market averages in the near term. For those interested, a full list of Zacks #1 Rank (Strong Buy) stocks can be found online.

It will be intriguing to observe how forecasts for upcoming quarters and the current fiscal year evolve in the coming days. Presently, the consensus EPS estimate stands at $1.27 with projected revenues of $7.45 billion for the next quarter, and $4.86 EPS on revenues of $24.54 billion for the current fiscal year.

Investors should also consider the industry's outlook, as it can significantly impact the stock's performance. The Zacks Industry Rank places the Insurance - Life Insurance sector in the top 27% of over 250 industries, indicating a generally favorable environment. Historical data reveals that stocks in the top half of Zacks-ranked industries outperform those in the bottom half by more than a two-to-one ratio.

Another company in the same sector, Abacus Life, Inc. (ABL), has yet to release its financial results for the September 2024 quarter. Their earnings report is scheduled for November 7.

Abacus Life is expected to report earnings of $0.14 per share, reflecting a remarkable year-over-year growth of 1300%. However, the consensus EPS estimate has been revised down by 2.2% in the last month to its current forecast. Their anticipated revenues stand at $26.08 million, marking a 23.5% increase compared to the same quarter last year.

Sun, Life, Earnings