Corebridge Financial, Inc. delivered a knock-out performance in the fourth quarter of 2023, surpassing analyst expectations. The adjusted operating earnings per share of $1.04 soared past the Zacks Consensus Estimate by 5.1%, marking a 12% improvement from the previous year. Adjusted revenues also rose impressively by 11.3% year over year, reaching $5.9 billion.
A Look Behind the Numbers
The stellar results were largely fueled by robust growth in premiums and deposits across the Individual Retirement and Institutional Markets segments. Corebridge also benefited from increased sales in its spread-based product portfolio as well as higher net investment income. However, these positives were partially counteracted by reduced underwriting margins and escalated benefits and expenses.
Quarterly Operational Highlights
Premiums and deposits saw a remarkable 20% year-over-year surge, totaling $10.5 billion in the fourth quarter. The net investment income also showed an impressive 18% growth, amounting to $3 billion.
Segmental Performance
The Individual Retirement segment witnessed a whopping 38% increase in premiums and deposits, reaching $5.3 billion. This was primarily driven by higher fixed annuity and fixed index annuity deposits. On the other hand, the Group Retirement segment recorded a 7% decline in premiums and deposits due to decreased plan acquisitions and out-of-plan variable annuity deposits.
Financial Position
Corebridge wrapped up the fourth quarter of 2023 with a cash balance of $612 million, a 10.9% increase from the previous year. Its total investments also grew by 5.7%, reaching $232.6 billion. However, long-term debt saw a 15.9% uptick, amounting to $9.1 billion by the end of the quarter.
During the fourth quarter, Corebridge repurchased 11.8 million common shares worth $252 million and paid out quarterly dividends of $145 million. It also distributed special dividends amounting to $731 million.
Full-Year Performance
For the entire year of 2023, Corebridge’s adjusted operating earnings per share climbed 12% year over year, reaching $4.10. Adjusted revenues also surged by 18.1% to $21.2 billion. Premiums and deposits and net investment income showed an impressive 26% and 16% year-over-year growth, respectively.
Looking Ahead
Corebridge aims to achieve a return on average equity in the range of 12-14% and maintain an average annual stockholder dividend of $600 million while sustaining a payout ratio of 60-65%.
Analyst Forecast
Currently boasting a Zacks Rank #3 (Hold), Corebridge’s strong performance continues to make it an interesting prospect for investors looking to gain exposure to the insurance industry.
