Please ensure Javascript is enabled for purposes of website accessibility

Here's Why Brighthouse Financial Is Soaring Today

By Matthew Frankel, CFP® – Feb 11, 2020 at 12:19PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The annuity and life insurance company delivered strong results for investors.

What happened

Insurance and financial services company Brighthouse Financial (BHF -4.75%) is soaring on Tuesday. As of 11 a.m. EST, the company's stock had risen by 14%.

As you might imagine given the large move and the time of year, Brighthouse reported its fourth-quarter and full-year 2019 results after the market's close on Monday, and that's what is fueling the move.

Crowd of people cheering.

Image source: Getty Images.

So what

Brighthouse surpassed expectations on both the top and bottom lines. Revenue in the quarter grew more than 4% year over year, beating estimates by $110 million. The company's adjusted earnings were similarly stronger than expected and marked 15% year-over-year growth.

The underlying performance numbers look quite strong. Annuity sales (Brighthouse's main business) for the full year were up by 23% over Brighthouse's 2018 total. Life insurance earnings, although a smaller part of the business, were 17% higher than in the fourth quarter of 2018. Brighthouse's book value grew from $122.67 at the end of 2018 to $148.64 at year-end 2019.

In addition, Brighthouse authorized the repurchase of another $500 million in stock -- an aggressive buyback for a company whose entire market capitalization is $5.1 billion. The company also reaffirmed its commitment to return $1.5 billion to shareholders from 2018 through 2021, and this new buyback authorization will put it 70% of the way there.

Now what

Besides the obvious catalyst of better-than-expected earnings and revenue, Brighthouse shareholders seem to be quite pleased with the company's results. Sales and earnings are growing throughout the business, and the company seems to be fully committed to returning tons of capital to shareholders.

Matthew Frankel, CFP has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Brighthouse Financial, Inc. Stock Quote
Brighthouse Financial, Inc.
BHF
$44.68 (-4.75%) $-2.23

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
329%
 
S&P 500 Returns
106%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.