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1. Company Snapshot

1.a. Company Description

Brighthouse Financial, Inc.provides annuity and life insurance products in the United States.It operates through three segments: Annuities, Life, and Run-off.


The Annuities segment offers variable, fixed, index-linked, and income annuities for contract holders' needs for protected wealth accumulation on a tax-deferred basis, wealth transfer, and income security.The Life segment provides term, universal, whole, and variable life policies for policyholders' needs for financial security and protected wealth transfer.The Run-off segment manages structured settlements, pension risk transfer contracts, certain company-owned life insurance policies, funding agreements, and universal life with secondary guarantees.


The company was incorporated in 2016 and is based in Charlotte, North Carolina.

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1.b. Last Insights on BHF

Brighthouse Financial's recent performance was driven by a definitive merger agreement with Aquarian Capital for $70 per share, representing a 35.1% premium. The deal, valued at approximately $4.1 billion, sparked a 26% surge in the stock. Improved net investment income and declining total expenses were notable in Q3 earnings, although premiums fell year-over-year. The company's robust capital ratios and record annuity sales also stand out. Analysts at Raymond James set a $72 target, adding to the stock's near-term catalysts and M&A appeal. (Source: Raymond James)

1.c. Company Highlights

2. Brighthouse Financial's Q2 2025 Earnings: A Mixed Bag

Brighthouse Financial reported a mixed set of earnings for Q2 2025, with total annuity sales increasing 16% sequentially and 8% year-over-year to $2.6 billion, while life insurance sales remained subdued at $33 million. The company's adjusted earnings per share came in at $3.43, missing analyst estimates of $4.7. Despite this, the company's combined RBC ratio remained within its target range of 400% to 450% in normal market conditions.

Publication Date: Aug -12

📋 Highlights
  • Capital Position Strengthened: Estimated combined RBC ratio of 405–425% remained within the target range of 400–450% under normal market conditions.
  • Annuity Sales Growth: Total annuity sales reached $2.6 billion, reflecting a 16% sequential increase and an 8% year-over-year rise.
  • Shareholder Returns: $43 million in common stock repurchases executed in Q2, demonstrating capital return to shareholders despite $202 million in corporate expenses.
  • Alternative Investment Yield Declined: Portfolio yield dropped to 1.5%, reducing alternative investment income amid broader market challenges.
  • Hedging Strategy Transition: Modifications to hedging strategies were completed by Q3 2025, aiming to separately manage VA and Shield businesses by year-end.

Capital Management and Returns

The company has been returning capital to shareholders, with $43 million of common stock repurchases in the quarter. As Dana Amante noted, "We're comfortable with our 10b5-1 plans and have been a returner of capital historically." The company's strategy remains focused on innovation in products, technology, and operations, with a continued emphasis on maintaining pricing discipline and growing sales.

Hedging Strategy and Product Development

Edward Spehar highlighted the company's transition to a revised hedging strategy, which is expected to be completed by the end of September. The company is pleased with its product development, technology, and operations, with Shield sales remaining strong despite a slowdown in growth.

Valuation Metrics

With a P/E Ratio of 3.99, P/B Ratio of 0.47, and P/S Ratio of 0.42, Brighthouse Financial's valuation appears relatively undervalued compared to its peers. The company's dividend yield is currently 0.0%, while its free cash flow yield stands at 1.93%. Its ROIC and ROE are 0.73% and 12.41%, respectively, indicating a moderate level of profitability.

Outlook

Analysts expect revenue growth of 3.0% next year, although the company has not provided a long-term free cash flow projection. With the company's capital-focused strategic initiatives and continued innovation in products and operations, Brighthouse Financial appears well-positioned for growth, despite the current mixed earnings report.

3. NewsRoom

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New Strong Sell Stocks for Nov. 19th

Nov -19

Source: zacks.com

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Bank of Montreal Can Trims Holdings in Brighthouse Financial, Inc. $BHF

Nov -19

Source: defenseworld.net

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Brighthouse Financial, Inc. (NASDAQ:BHF) Given Consensus Rating of “Reduce” by Brokerages

Nov -18

Source: defenseworld.net

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Brighthouse Financial Announces Preferred Stock Dividends and Related Depositary Share Distributions

Nov -17

Source: businesswire.com

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David Einhorn's Strategic Moves: PG&E Corp Takes Center Stage with 3.79% Portfolio Impact

Nov -14

Source: gurufocus.com

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Brighthouse Financial (BHF) Reports Q3 Earnings: What Key Metrics Have to Say

Nov -07

Source: zacks.com

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Brighthouse Financial Q3 Earnings Miss Estimates, Premiums Fall Y/Y

Nov -07

Source:

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Brighthouse Financial (BHF) Q3 Earnings and Revenues Miss Estimates

Nov -07

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.75%)

6. Segments

Annuities

Expected Growth: 4.65%

Strong sales momentum driven by Brighthouse Financial's diversified distribution channels, increasing demand for retirement savings products, and competitive product offerings. Additionally, the company's focus on digital transformation and cost savings initiatives have improved operational efficiency, contributing to the 4.65% growth rate.

Adjustments

Expected Growth: 4.83%

The 4.83% growth is driven by Brighthouse Financial, Inc.'s successful execution of its strategic initiatives, including expansion of its annuity business, growth in life insurance premiums, and effective cost management. Additionally, the company's focus on digital transformation and investments in technology have improved operational efficiency, contributing to the strong growth.

Run-off

Expected Growth: 4.83%

The 4.83% growth in Run-off from Brighthouse Financial, Inc. is driven by a combination of factors, including a favorable interest rate environment, effective risk management, and a disciplined approach to capital allocation. Additionally, the company's focus on expense management and operational efficiency has contributed to the growth.

Life

Expected Growth: 4.73%

Brighthouse Financial's Life segment growth of 4.73% is driven by increasing demand for term life insurance, expansion of Shield Level Term product, and growth in annuity sales. Additionally, the company's focus on digital transformation, improved customer experience, and strategic partnerships have contributed to the segment's growth.

Corporate & Other

Expected Growth: 4.77%

The 4.77% growth in Corporate & Other segment of Brighthouse Financial, Inc. is driven by effective expense management, improved investment returns, and a favorable impact from hedging activities. Additionally, the company's focus on reducing debt and optimizing its capital structure has also contributed to this growth.

7. Detailed Products

Term Life Insurance

Provides temporary life insurance coverage for a specified period of time (e.g., 10, 20, or 30 years) with a fixed premium rate.

Whole Life Insurance

Offers permanent life insurance coverage with a cash value component that grows over time, providing a guaranteed death benefit and a guaranteed cash value.

Universal Life Insurance

Combines a death benefit with a savings component, allowing flexible premium payments and adjustable coverage amounts.

Indexed Universal Life Insurance

Combines a death benefit with a savings component that earns interest based on the performance of a specific stock market index.

Fixed Annuities

Provides a guaranteed rate of return for a fixed period of time, with the option to convert to a lifetime income stream.

Variable Annuities

Combines a death benefit with a savings component that allows investments in a variety of assets, with the potential for tax-deferred growth.

8. Brighthouse Financial, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Brighthouse Financial, Inc. operates in a highly competitive industry, and customers have various alternatives to choose from. However, the company's strong brand recognition and diversified product offerings mitigate the threat of substitutes to some extent.

Bargaining Power Of Customers

Brighthouse Financial, Inc. has a large customer base, and individual customers have limited bargaining power. However, the company operates in a highly competitive industry, and customers can easily switch to competitors' products, giving them significant bargaining power.

Bargaining Power Of Suppliers

Brighthouse Financial, Inc. has a diversified supplier base, and no single supplier has significant bargaining power over the company. The company's large scale of operations also gives it negotiating power over its suppliers.

Threat Of New Entrants

The life insurance industry has high barriers to entry, including significant capital requirements and regulatory hurdles. While new entrants are possible, they would face significant challenges in competing with established players like Brighthouse Financial, Inc.

Intensity Of Rivalry

The life insurance industry is highly competitive, with many established players competing for market share. Brighthouse Financial, Inc. faces intense competition from rivals, which can lead to pricing pressure and higher marketing expenses.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 58.66%
Debt Cost 6.46%
Equity Weight 41.34%
Equity Cost 9.69%
WACC 7.79%
Leverage 141.92%

11. Quality Control: Brighthouse Financial, Inc. passed 1 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Primerica

A-Score: 6.2/10

Value: 5.6

Growth: 7.3

Quality: 7.4

Yield: 3.0

Momentum: 5.0

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
Globe Life

A-Score: 6.1/10

Value: 6.7

Growth: 6.3

Quality: 6.5

Yield: 1.0

Momentum: 8.5

Volatility: 7.7

1-Year Total Return ->

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Stock-Card
F&G Annuities & Life

A-Score: 5.9/10

Value: 8.4

Growth: 8.4

Quality: 6.2

Yield: 5.0

Momentum: 1.5

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
American Equity

A-Score: 5.4/10

Value: 9.6

Growth: 7.3

Quality: 6.1

Yield: 1.0

Momentum: 5.0

Volatility: 3.3

1-Year Total Return ->

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Stock-Card
Genworth Financial

A-Score: 5.0/10

Value: 7.3

Growth: 2.4

Quality: 6.0

Yield: 0.0

Momentum: 7.5

Volatility: 6.7

1-Year Total Return ->

View Full Report
Stock-Card
Brighthouse Financial

A-Score: 4.5/10

Value: 7.3

Growth: 2.9

Quality: 6.7

Yield: 0.0

Momentum: 7.0

Volatility: 3.0

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

65.52$

Current Price

65.52$

Potential

-0.00%

Expected Cash-Flows