Prudential Financial (NYSE:PRU) Q3 2020 Earnings Prep

in EARNINGS/INVESTING IDEAS by

Prudential Financial, Inc. (NYSE:PRU) is scheduled to report Q3 earnings results after markets close for trading on November 3, 2020.

The company is expected to report earnings of $2.67/share on revenue of $13.531 billion. The consensus earnings per share (EPS) of $2.67/share is based on a poll of 10 analysts and represents a decline in eps of −17.0% over the same quarter last year, when the company reported earnings of $3.22/share.

The revenue forecast of $13.531 billion based on a poll of 5 analysts implies a year-over-year (YoY) growth in revenue of 4.7%. Last year the company reported $12.928 billion in revenue for the quarter.

Expected to report EPS contraction of −17.0% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $13,530.78 $12,928.00 4.7%
EPS $2.67 $3.22 −17.0%

Earnings Call Trends

Historically, management has exceeded analyst expectations 3 out of the last 8 tracked quarters, and missed expectations 5 quarters.

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

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $1.72 $1.85 7.3% Beat
Q1, 2020 $2.80 $2.32 −17.1% Missed
Q4, 2019 $2.05 $2.33 13.4% Beat
Q3, 2019 $3.07 $3.22 4.8% Beat
Q2, 2019 $3.22 $3.14 −2.6% Missed
Q1, 2019 $3.15 $3 −4.6% Missed
Q4, 2018 $2.79 $2.44 −12.5% Missed
Q3, 2018 $3.16 $3.15 −0.3% 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 reacted by increasing 4.3%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 4, 2020 $64.43 $67.20 4.3% Increase
May 5, 2020 $58.88 $54.12 −8.1% Decline
February 4, 2020 $91.50 $95.64 4.5% Increase
November 4, 2019 $92.97 $92.05 −1.0% Decline

Fundamentals And Technical Analysis

Prudential Financial, Inc. is currently trading at $61.73/share, down −2.7% for the day. The company is trading at approximately 63.8% of its 52-week high of $97.24/share. The company’s stock price is down −8.1% since the last earnings report and down −6.7% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 37.14 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:PRU Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of −140.55 and a forward P/E multiple of 7.00.

Prudential Financial, Inc.’s current share price also implies a price-to-book (P/B) multiple of 0.37. 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) $61.73
P/E Ratio −140.6x
P/E Ratio (Fwd) 7.0x
PEG Ratio 1.4
Total Debt / Total Capital 58.7%
Levered Free Cash Flow $24.78 billion
EV / EBITDA −363.0x

Finbox

Prudential Financial, Inc. is a large-cap stock with a market capitalization of $25.041 billion and a total enterprise value of $40.927 billion. The company operates in the Financials sector and the Insurance industry.

Prudential Financial, Inc., through its subsidiaries, provides insurance, investment management, and other financial products and services. It operates through eight segments: PGIM, Retirement, Group Insurance, Individual Annuities, Individual Life, Assurance IQ, International Businesses, and Closed Block. The company offers asset management public and private fixed income, public equity and real estate, commercial mortgage origination and servicing, and mutual funds and other retail services to institutional, private, and sub-advisory clients, as well as to insurance company separate accounts, government sponsored entities, and the general account. It provides a range of retirement investment, and income products and services to retirement plan sponsors in the public, private, and not-for-profit sectors; and group life, long-term and short-term group disability, and group corporate-, bank-, and trust-owned life insurance in the United States, primarily to institutional clients for use in connection with employee plans and affinity groups. The company develops and distributes individual variable and fixed annuity products, principally to the mass affluent and affluent markets; and individual variable, term, and universal life insurance products to the mass middle, mass affluent, and affluent markets in the United States. It also offers individual life insurance, retirement, and related products to the mass affluent and affluent markets in Japan, Korea, and other foreign countries, as well as middle income and mass affluent markets. In addition, the company provides third-party life, health, Medicare, and property and casualty products to retail shoppers through its digital and independent agent channels. It offers its products and services to individual and institutional customers through its proprietary and third-party distribution networks. The company was founded in 1875 and is headquartered in Newark, New Jersey.

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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