Lincoln National Corporation LNC is benefiting from strong Annuities and Group Protection segment performance, strategic product shifts, expense management and a robust financial position.
LNC’s Zacks Rank & Price Performance
Lincoln National currently carries a Zacks Rank #3 (Hold).
The stock has gained 16.5% in the past six months, outperforming the industry’s decline of 0.7%. The finance sector and S&P 500 Index grew 5.4% and declined 0.7%, respectively, in the same time frame.
LNC 6-Month Price Performance
Image Source: Zacks Investment Research
LNC’s Rising Estimates
The Zacks Consensus Estimate for Lincoln National’s 2025 earnings is pegged at $7.74 per share, indicating a year-over-year improvement of 9.5%. The consensus mark for revenues is pegged at $19.1 billion, implying a year-over-year increase of 4.2%.
The consensus estimate for 2026 earnings is pegged at $8.42 per share, indicating an increase of 8.8% from the 2025 estimate. The consensus estimate for revenues is pegged at $19.6 billion, implying 2.6% growth from the 2025 estimate.
LNC’s bottom line outpaced estimates in each of the trailing four quarters, the average surprise being 15.8%.
LNC’s Valuation
Price-to-book (P/B) is one of the multiples used for valuing insurance stocks. Compared with the life insurance industry’s trailing 12-month P/B ratio of 1.80, Lincoln National has a reading of 0.84. It is quite evident that the stock is currently undervalued.
LNC’s Solid Return on Equity
Return on equity in the trailing 12 months is currently 18.5% for LNC, which is higher than the industry’s average of 15.5%. This substantiates the company’s efficiency in utilizing shareholders’ funds.
Lincoln National’s Key Business Tailwinds
Lincoln National's revenues are poised for growth, driven by the robust performance of its Annuities and Group Protection segments, alongside higher fee income from variable annuities. In the Annuities segment, growth has been fueled by increased account values and improved spread income.
Notable products such as the Lincoln Investor Advantage, Lincoln Level Advantage indexed variable annuity and Lincoln ChoicePlus have significantly contributed to this success. Similarly, the Group Protection unit is benefiting from expanded scale, broader distribution networks and strategic acquisitions, leading to a 42.1% year-over-year increase in operating income in 2024.
Lincoln National has expanded its offerings with two innovative Variable Universal Life (VUL) insurance products—an upgraded Lincoln AssetEdge VUL (2025) and the new Lincoln AssetEdge SVUL—enhancing flexibility, investment options and death benefit protection. Additionally, LNC has partnered with Bain Capital and Partners Group to introduce two private markets-focused investment funds by late 2025, targeting private credit and diversified royalty investments.
With expertise in retirement planning, insurance and wealth protection, Lincoln National serves around 17 million customers, positioning it for sustained sales growth. The business is also focused on shifting its product mix toward offerings without long-term guarantees, thereby reducing sensitivity to interest rate fluctuations. In addition, ongoing expense management initiatives have supported margin improvements while the adoption of advanced technologies has enhanced operational efficiency and customer experience.
Lincoln National maintains a solid financial foundation, bolstered by a rising cash balance and declining debt levels. As of Dec. 31, 2024, cash and invested cash were $5.8 billion, which soared 72.4% from the 2024-end level. This strong financial position enables the company to pursue growth opportunities and strategically distribute capital. Its dividend yield of 5.01% remains higher than the industry’s average of 3.2%.
Headwinds for LNC
The Life Insurance segment has faced challenges from elevated mortality and morbidity claims linked to the COVID pandemic, which weighed on earnings. While pandemic-related claims have eased, the segment remains pressured by higher reinsurance costs and margin compression. Life Insurance sales dropped 17.4% year over year in the fourth quarter of 2024.
Stocks to Consider
Some better-ranked stocks in the insurance space are EverQuote, Inc. EVER, Old Republic International Corporation ORI and Horace Mann Educators Corporation HMN. While EverQuote currently sports a Zacks Rank #1 (Strong Buy), Old Republic and Horace Mann carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
EverQuote’s earnings surpassed estimates in each of the last four quarters, the average surprise being 160.73%. The Zacks Consensus Estimate for EVER’s 2025 earnings indicates a rise of 34.1% while the same for revenues implies an improvement of 25.2% from the respective 2024 figures. The consensus mark for EVER's 2025 earnings has moved 45.7% north in the past 30 days.
The bottom line of Old Republic beat estimates in each of the trailing four quarters, the average surprise being 37.25%. The Zacks Consensus Estimate for ORI’s 2025 earnings indicates a rise of 5% while the same for revenues implies an improvement of 8.1% from the respective 2024 figures. The consensus mark for ORI’s 2025 earnings has moved 3.2% north in the past 60 days.
Horace Mann’s earnings outpaced estimates in two of the trailing four quarters, matched the mark once and missed the same in the remaining one occasion, the average surprise being 13.17%. The Zacks Consensus Estimate for HMN’s 2025 earnings indicates a rise of 21.7% while the same for revenues implies an improvement of 8.7% from the respective 2024 figures. The consensus mark for HMN’s 2025 earnings has moved 1.3% north in the past 60 days.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Lincoln National Corporation (LNC) : Free Stock Analysis Report
EverQuote, Inc. (EVER) : Free Stock Analysis Report
Old Republic International Corporation (ORI) : Free Stock Analysis Report
Horace Mann Educators Corporation (HMN) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
Comments