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NEW YORK - Voya Financial, Inc. (NYSE:VOYA), a prominent life insurance company, disclosed today that its alternative investment income and prepayment fees for the second quarter of 2024 fell short of long-term expectations.
The company's preliminary estimates indicate a pre-tax income of approximately $36 million to $48 million, which is $7 million to $18 million below its long-term projections, excluding variable and incentive compensation.
The company's long-term expectations for alternative investments target a 9% annual return, while prepayment fees are expected to contribute 10 basis points annually to yield. These estimates include income from the company's general account and investment capital returns in its Investment Management segment.
Voya Financial has cautioned that these figures are preliminary and subject to change as the financial closing procedures for the quarter ending June 30, 2024, have not yet been completed. Furthermore, these results have not been audited or reviewed by Ernst & Young LLP, Voya's independent registered public accounting firm, and may be adjusted upon the completion of standard financial closing procedures.
Investors are advised to consider these preliminary figures with caution, as they are not a substitute for full financial statements prepared in accordance with U.S. GAAP, and may not necessarily be indicative of future performance. The complete and final financial results for the second quarter will be available in the company's quarterly earnings release and financial supplement, scheduled for July 30, 2024.
This information, based on a press release statement, is provided in accordance with Regulation FD and has not been filed for purposes of Section 18 of the Securities Exchange Act of 1934, nor is it intended to be incorporated by reference into any filings under the Securities Act of 1933.
In other recent news, Voya Financial has reported a significant 23% year-over-year increase in adjusted operating earnings per share (EPS) to $1.77 in the first quarter of 2024. The company is propelling towards its full-year EPS target range of $8.25 to $8.45. Voya has announced a new $500 million share repurchase authorization, reinforcing its commitment to return $800 million of excess capital to shareholders within the year.
Voya Financial has also announced the appointment of William J. Mullaney to its board of directors. Mullaney, with a career spanning nearly four decades, will contribute his extensive industry knowledge and experience to the company's Audit, Technology, Innovation and Operations Committee, and the Nominating, Governance and Social Responsibility Committee.
Piper Sandler, after conducting a meeting with Voya Financial's top management, has maintained its Overweight rating on the company with a steady price target of $86.00. The firm sees potential areas for improvement in Voya's various business segments that could stabilize and increase earnings per share (EPS) estimates over time.
Despite a decline in revenue yields in the Investment Management sector due to a mix shift, Voya's expansion into lower deductible levels in its stop-loss business is expected to contribute to sales growth. These recent developments reflect Voya's strategic focus on workplace strategy and investment management.
InvestingPro Insights
As Voya Financial (NYSE:VOYA) navigates through the challenges of its alternative investment income and prepayment fees, the company’s financial health and strategic decisions become crucial for investors. According to InvestingPro, VOYA has been actively bolstering shareholder value, as evidenced by its aggressive share buybacks. Moreover, the company has a track record of raising its dividend for 5 consecutive years, signaling a commitment to returning value to shareholders.
From a valuation standpoint, Voya Financial is trading at a compelling P/E ratio of 9.65, which is even more attractive when adjusted for the last twelve months as of Q1 2024, at 8.47. This is paired with a PEG Ratio of 0.17, suggesting that the company's earnings growth may not be fully reflected in its current price. With a steady dividend yield of 2.29%, Voya offers income-seeking investors a consistent return.
Investors eyeing long-term profitability will find reassurance in the company's performance over the last twelve months, with analysts predicting profitability for the current year. For those considering Voya Financial as a potential addition to their portfolio, there are additional InvestingPro Tips available that delve deeper into the company’s financials and market position.
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