Voya Financial (NYSE:VOYA) Q3 Earnings: What Can You Expect?

in EARNINGS/INVESTING IDEAS by

Voya Financial, Inc. (NYSE:VOYA) is scheduled to report Q3 earnings results after markets close for trading on November 4, 2020.

The company is expected to report earnings of $1.37/share on revenue of $1.402 billion. The consensus earnings per share (EPS) of $1.37/share is based on a poll of 11 analysts and represents a growth in eps of 68.8% over the same quarter last year, when the company reported earnings of $0.81/share.

The revenue forecast of $1.402 billion based on a poll of 4 analysts implies a year-over-year (YoY) decline in revenue of −32.0%. Last year the company reported $2.062 billion in revenue for the quarter.

Expected to report EPS growth of 68.8% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $1,402.05 $2,062.00 −32.0%
EPS $1.37 $0.81 68.8%

Earnings Call Trends

Historically, management has exceeded analyst expectations 2 out of the last 8 tracked quarters, and missed expectations 6 quarters.

What are your expectations from Voya Financial, Inc. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.86 $0.15 −82.5% Missed
Q1, 2020 $0.86 $0.83 −3.8% Missed
Q4, 2019 $1.10 $1.07 −2.9% Missed
Q3, 2019 $1.40 $0.81 −42.0% Missed
Q2, 2019 $1.46 $1.52 3.8% Beat
Q1, 2019 $1.12 $1.07 −4.4% Missed
Q4, 2018 $1.22 $1.32 8.5% Beat
Q3, 2018 $1.19 $0.84 −29.1% Missed

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price did not react much to the update.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 5, 2020 $49.47 $49.59 0.2% Increase
May 5, 2020 $44.15 $41.82 −5.3% Decline
February 10, 2020 $62.34 $61.97 −0.6% Decline
November 5, 2019 $55.60 $57.62 3.6% Increase

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −3.59, the model suggests that the company is not likely to be an earnings manipulator. A value of −3.59 implies a 0.0% chance of earnings manipulation.

Fundamentals And Technical Analysis

Voya Financial, Inc. is currently trading at $47.78/share, down −2.5% for the day. The company is trading at approximately 75.4% of its 52-week high of $63.81/share. The company’s stock price is down −3.6% since the last earnings report and down −5.9% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 44.65 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:VOYA Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 12.80 and a forward P/E multiple of 13.23.

Voya Financial, Inc.’s current share price also implies a price-to-book (P/B) multiple of 0.63. The following table summarizes some other key fundamental ratios:

Data as of October 28, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $47.78
P/E Ratio 12.8x
P/E Ratio (Fwd) 13.2x
PEG Ratio 0.0
Total Debt / Total Capital 44.7%
Levered Free Cash Flow $1.193 billion
EV / EBITDA −56.3x

Finbox

Voya Financial, Inc. is a mid-cap stock with a market capitalization of $6.182 billion and a total enterprise value of $11.405 billion. The company operates in the Financials sector and the Diversified Financial Services industry.

Voya Financial, Inc. operates as a retirement, investment, and employee benefits company in the United States. The company’s Retirement segment offers tax-deferred employer-sponsored retirement savings plans and administrative services; and individual retirement accounts, and other retail financial products and financial services, as well as financial planning and advisory services. This segment serves corporate, education, healthcare, and other non-profit and government entities, as well as institutional and individual customers. Its Investment Management segment provides fixed income, equity, multi-asset, and alternative products and solutions to individual investors and institutional clients through its direct sales force, consultant channel, banks, broker-dealers, and independent financial advisers. The company’s Employee Benefits segment offers stop loss, group life, voluntary employee-paid, and disability products through consultants, brokers, third-party administrators, enrollment firms, and technology partners to mid-sized and large businesses. Voya Financial, Inc. has a strategic relationship with Vault. The company was formerly known as ING U.S., Inc. and changed its name to Voya Financial, Inc. in April 2014. Voya Financial, Inc. was incorporated in 1999 and is based in New York, New York.

Expertise: financial modeling, mergers & acquisitions. Andy is also a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to do investment research. Andy’s background is in investment banking where he led the analysis on over 50 board advisory engagements involving mergers and acquisitions, fairness opinions and solvency opinions. Some of his board advisory highlights: - Sears Holdings Corp.’s $620 mm spin-off via rights offering of Sears Outlet, Hometown Stores and Sears Hardware Stores. - Cerberus Capital Management’s $3.3 bn acquisition of SUPERVALU Inc.’s New Albertsons, Inc. assets. Andy can be reached at andy@finbox.io or at +1 (516) 778-6257.

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