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Hartford Financial (HIG) Q2 Earnings: What's in the Offing?

The Hartford Financial Services Group, Inc. HIG will release second-quarter 2017 financial results on Jul 27, after the closing bell.

Last quarter, the company witnessed a negative earnings surprise of 1.96%.  Let’s see how things are shaping up for this announcement.

Factors Influencing this Quarter

We expect Hartford Financial’s results to be supported by improved performance of its Personal Auto business.

Commercial Lines in small and middle markets are likely to perform well, boosting both top-line and bottom-line, continuing the previous quarter’s trend.

We also expect the Group Benefit and Mutual Funds segment to deliver a solid performance, reflecting the company’s claims expertise and the improvements made in its book of business over the years.

Hartford Financial’s strategic investment in products, distribution, data and analytics, as well as digital capabilities, aimed at customer acquisition and retention, are likely to contribute to  revenue growth.

The company is also expected to enhance shareholders’ value during the quarter through share repurchases, which might impact the bottom-line by limiting the outstanding share count.

However, higher auto loss costs are expected to have adversely affected underwriting margins.

In addition, as the company is a multi-line insurer, it incurs considerable catastrophe losses. This is also likely to adversely impact earnings in the quarter.

Earnings Whispers

Our proven model does not conclusively show that Hartford Financial is likely to beat on earnings in the quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.

Zacks ESP: Hartford Financial has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 95 cents. You can uncover the best stocks to buy or sell before they’re reported with our https://www.zacks.com/premium/esp-buy?adid=zp_article_espfil...">Earnings ESP Filter.

Zacks Rank: Hartford Financial has a Zacks Rank #4 (Sell). 

Please note that we caution against Sell-rated stocks (Zacks Rank #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Hartford Financial Services Group, Inc. (The) Price and EPS Surprise

Stocks to Consider

Here are some companies from the Finance sector that you may want to consider as they have the right combination of elements to post an earnings beat this quarter:

Sun Life Financial Inc. SLF has an Earnings ESP of +2.74% and a Zacks Rank #1. The company is slated to report second-quarter earnings results on Aug 9. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cigna CorporationCI has an Earnings ESP of +0.81% and a Zacks Rank #2. The company is expected to report second-quarter earnings results also on Aug 4.

Aon plc. AON, which is expected to report second-quarter earnings results on Aug 4, has an Earnings ESP of +0.69% and a Zacks Rank #3.

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Aon PLC (AON): Free Stock Analysis Report
 
Sun Life Financial Inc. (SLF): Free Stock Analysis Report
 
Cigna Corporation (CI): Free Stock Analysis Report
 
Hartford Financial Services Group, Inc. (The) (HIG): Free Stock Analysis Report
 
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