Update shared on15 Aug 2025
Analysts have reduced EPS estimates for Brighthouse Financial amid sector-wide headwinds and declining variable investment income, but ongoing buyout interest and potential acquisition premiums provide support, resulting in an unchanged consensus price target of $56.22.
Analyst Commentary
- Bearish analysts cite continued fee and spread headwinds and have reduced EPS estimates for Brighthouse Financial and the broader life insurance sector.
- The challenging pre-announcement regarding lower variable investment income from MetLife suggests further deterioration in this key revenue component for the sector, delaying normalization into 2026.
- Updated post-Q2 estimates in the life insurance group prompted further reductions in price targets.
- Bullish analysts see the share price weakness following media reports of potential buyout offers as a buying opportunity, expecting renewed bidder activity and higher acquisition premiums.
- The current buyout interest and the possibility of new or returning bidders could drive the takeout price above recent market valuations, supporting higher price targets from bullish analysts.
What's in the News
- Aquarian Holdings is in exclusive negotiations to acquire Brighthouse Financial, with a deal possibly finalized in the coming weeks following a competitive bidding process (Wall Street Journal, 2025-07-15; Key Developments, 2025-07-15).
- Shares of Brighthouse surged 10-12% in after-hours trading on news of advanced acquisition talks with Aquarian Holdings (Wall Street Journal, 2025-07-15; Key Developments, 2025-07-15).
- Multiple private equity firms, including TPG, Blackstone, Apollo, and Carlyle, showed interest in acquiring Brighthouse, but only TPG and Aquarian submitted final-round bids, with TPG’s bid limited to certain parts of the company and ultimately unsuccessful (Financial Times, 2025-06-24; Key Developments, 2025-07-15).
- From April 1 to June 30, 2025, Brighthouse completed the repurchase of 781,800 shares ($43.17 million), bringing total buybacks under the current program to 6,309,262 shares (10.43% of shares outstanding) for $334.77 million (Key Developments, 2025-08-07).
- The company’s ongoing buyback program and the heightened M&A activity underscore strong shareholder focus and significant private equity interest in the U.S. life insurance sector (Wall Street Journal, Financial Times, Key Developments).
Valuation Changes
Summary of Valuation Changes for Brighthouse Financial
- The Consensus Analyst Price Target remained effectively unchanged, at $56.22.
- The Future P/E for Brighthouse Financial remained effectively unchanged, at 3.54x.
- The Discount Rate for Brighthouse Financial remained effectively unchanged, at 11.27%.
Disclaimer
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