Prudential Financial, Inc. (PRU) topped Q2 earnings estimates on improved performance of its U.S. Businesses. The company engages in the provision of financial products and services and is an active global investment manager.
The company reported adjusted operating income of $3.79 per share for the quarter, beating consensus estimate of $2.97 per share. Also, the bottom line compares favorably with last year’s $1.85 per share.
Prudential’s U.S. Businesses reported adjusted operating income of $1.09 billion, compared to $455 million in the year-ago quarter. The upside was supported by higher variable investment income, and higher net fee income, driven primarily by equity market appreciation.
As of June 30, 2021, the company held assets under management of $1.73 trillion, up from $1.61 trillion reported last year. (See Prudential stock charts on TipRanks)
The Chairman and CEO of Prudential, Charles Lowrey, said, “Looking forward, we remain confident in our ability to execute against the company’s strategy to fulfill our purpose of making lives better by solving the financial challenges of our changing world.”
Following the release, Wells Fargo analyst Elyse Greenspan maintained a Hold rating on the stock with a price target of $105 (upside potential of 2.8%).
Greenspan said, “Prudential has rolled out a plan to shift its business mix towards high growth businesses (including PGIM and emerging markets) and significantly lower its concentration to annuities, its most interest-rate sensitive business. While this should result in lower interest-rate exposure it could also potentially result in a lower earnings profile for PRU.”
Based on the 1 Buy and 8 Holds, the stock has a Hold consensus. The average Prudential price target of $107.67 implies 5.4% upside potential from current levels.
Furthermore, Prudential scores a “Perfect 10” on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.
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