NYSE:LNC

Stock Analysis Report

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Executive Summary

Lincoln National Corporation, through its subsidiaries, operates multiple insurance and retirement businesses in the United States.


Snowflake Analysis

Very undervalued established dividend payer.


Similar Companies

Share Price & News

How has Lincoln National's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: LNC's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

12.3%

LNC

4.5%

US Insurance

2.7%

US Market


1 Year Return

-33.9%

LNC

-15.2%

US Insurance

9.1%

US Market

Return vs Industry: LNC underperformed the US Insurance industry which returned -14.9% over the past year.

Return vs Market: LNC underperformed the US Market which returned 8.4% over the past year.


Shareholder returns

LNCIndustryMarket
7 Day12.3%4.5%2.7%
30 Day7.4%4.3%4.5%
90 Day-13.4%-12.2%2.3%
1 Year-31.7%-33.9%-13.0%-15.2%11.5%9.1%
3 Year-35.8%-40.2%1.0%-7.1%30.6%22.0%
5 Year-26.0%-33.9%30.8%14.6%57.2%39.5%

Price Volatility Vs. Market

How volatile is Lincoln National's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Lincoln National undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: LNC ($39.31) is trading below our estimate of fair value ($153.61)

Significantly Below Fair Value: LNC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: LNC is good value based on its PE Ratio (11.4x) compared to the Insurance industry average (14x).

PE vs Market: LNC is good value based on its PE Ratio (11.4x) compared to the US market (16x).


Price to Earnings Growth Ratio

PEG Ratio: LNC is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: LNC is good value based on its PB Ratio (0.5x) compared to the US Insurance industry average (0.9x).


Next Steps

Future Growth

How is Lincoln National forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

29.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LNC's forecast earnings growth (29% per year) is above the savings rate (2.2%).

Earnings vs Market: LNC's earnings (29% per year) are forecast to grow faster than the US market (21.7% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: LNC's revenue (2.4% per year) is forecast to grow slower than the US market (8.8% per year).

High Growth Revenue: LNC's revenue (2.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LNC's Return on Equity is forecast to be low in 3 years time (11.1%).


Next Steps

Past Performance

How has Lincoln National performed over the past 5 years?

-0.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LNC has a large one-off loss of $193.0M impacting its March 31 2020 financial results.

Growing Profit Margin: LNC's current net profit margins (3.9%) are lower than last year (9.1%).


Past Earnings Growth Analysis

Earnings Trend: LNC's earnings have declined by -0.1% per year over the past 5 years.

Accelerating Growth: LNC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: LNC had negative earnings growth (-55%) over the past year, making it difficult to compare to the Insurance industry average (-0.4%).


Return on Equity

High ROE: LNC's Return on Equity (4.1%) is considered low.


Next Steps

Financial Health

How is Lincoln National's financial position?


Financial Position Analysis

Short Term Liabilities: LNC's short term assets ($41.3B) exceed its short term liabilities ($8.9B).

Long Term Liabilities: LNC's short term assets ($41.3B) do not cover its long term liabilities ($293.2B).


Debt to Equity History and Analysis

Debt Level: LNC's debt to equity ratio (45.6%) is considered high.

Reducing Debt: LNC's debt to equity ratio has increased from 40.1% to 45.6% over the past 5 years.

Debt Coverage: LNC's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: LNC's interest payments on its debt are well covered by EBIT (3.7x coverage).


Balance Sheet


Next Steps

Dividend

What is Lincoln National's current dividend yield, its reliability and sustainability?

4.07%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: LNC's dividend (4.07%) is higher than the bottom 25% of dividend payers in the US market (1.69%).

High Dividend: LNC's dividend (4.07%) is low compared to the top 25% of dividend payers in the US market (4.45%).


Stability and Growth of Payments

Stable Dividend: LNC's dividends per share have been stable in the past 10 years.

Growing Dividend: LNC's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (44.5%), LNC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: LNC's dividends in 3 years are forecast to be well covered by earnings (18.5% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

7.8yrs

Average management tenure


CEO

Dennis Glass (69yo)

12.83yrs

Tenure

US$15,412,217

Compensation

Mr. Dennis Robert Glass serves as the President and Director of The Lincoln National Life Insurance Company and served as its Chief Executive Officer. Mr. Glass serves as an Executive Officer of Lincoln Li ...


CEO Compensation Analysis

Compensation vs Market: Dennis's total compensation ($USD15.41M) is above average for companies of similar size in the US market ($USD7.31M).

Compensation vs Earnings: Dennis's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Dennis Glass
President12.83yrsUS$15.41m0.37% $28.0m
Randal Freitag
Executive VP9.33yrsUS$4.72m0.083% $6.3m
Ellen Cooper
Executive VP & Chief Investment Officer7.75yrsUS$3.71m0.048% $3.7m
Lisa Buckingham
Executive VP and Chief People11.42yrsUS$3.40m0.030% $2.3m
Wilford Fuller
Executive VP9.17yrsUS$4.66m0.11% $8.0m
Christine Janofsky
Senior VP & Chief Accounting Officer4.17yrsno data0.0012% $92.7k
Kenneth Solon
Executive VP4.33yrsno data0.018% $1.4m
Lucy Gase
Senior VP and Head of Administrative Services & Strategic Support1.67yrsno datano data
Christopher Giovanni
Senior VP of Investor Relations & Corporate Treasurerno datano datano data
Steve Harris
Chief Ethics & Compliance Officer and Senior VP3.08yrsno datano data

7.8yrs

Average Tenure

55yo

Average Age

Experienced Management: LNC's management team is seasoned and experienced (7.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Dennis Glass
President12.83yrsUS$15.41m0.37% $28.0m
Michael Mee
Independent Director19.33yrsUS$280.00k0.00043% $32.7k
Gary Kelly
Independent Director10.5yrsUS$315.00k0.0015% $117.7k
George Henderson
Independent Director14.08yrsUS$316.90k0.0045% $341.0k
Marguerite Lachman
Independent Director35yrsUS$359.40k0.0015% $117.7k
Patrick Pittard
Independent Director14.08yrsUS$329.40kno data
Eric Johnson
Independent Director22yrsUS$295.00kno data
William Cunningham
Independent Non-Executive Chairman11yrsUS$516.00k0.0045% $343.3k
Deirdre Connelly
Independent Director4yrsUS$293.07k0.00052% $39.5k
Lynn Utter
Independent Director2.5yrsUS$283.50kno data

14.1yrs

Average Tenure

69.5yo

Average Age

Experienced Board: LNC's board of directors are seasoned and experienced ( 14.1 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: LNC insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Lincoln National Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Lincoln National Corporation
  • Ticker: LNC
  • Exchange: NYSE
  • Founded: 1905
  • Industry: Life and Health Insurance
  • Sector: Insurance
  • Market Cap: US$7.596b
  • Shares outstanding: 193.22m
  • Website: https://www.lfg.com

Number of Employees


Location

  • Lincoln National Corporation
  • 150 North Radnor Chester Road
  • Suite A305
  • Radnor
  • Pennsylvania
  • 19087
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LNCNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1969
0JV3LSE (London Stock Exchange)YesCommon StockGBUSDJan 1969
LCODB (Deutsche Boerse AG)YesCommon StockDEEURJan 1969
L1NC34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 1 REPR 1 COMBRBRLJan 2020

Biography

Lincoln National Corporation, through its subsidiaries, operates multiple insurance and retirement businesses in the United States. It operates through four segments: Annuities, Retirement Plan Services, Life Insurance, and Group Protection. The Annuities segment offers variable, fixed, and indexed variable annuities. The Retirement Plan Services segment provides employers with retirement plan products and services primarily in the defined contribution retirement plan marketplace. This segment offers individual and group variable annuities, group fixed annuities, and mutual fund-based programs; and a range of plan services, including plan recordkeeping, compliance testing, participant education, and trust and custodial services. The Life Insurance segment provides life insurance products, including term insurance, such as single and survivorship versions of universal life insurance; variable universal life insurance; indexed universal life insurance products; and critical illness and long-term care riders. The Group Protection segment offers group non-medical insurance products comprising short and long-term disability, statutory disability and paid family medical leave administration and absence management services, term life, dental, vision and accident, and critical illness benefits and services to the employer marketplace through various forms of employee-paid and employer-paid plans. The company distributes its products through consultants, brokers, planners, agents, financial advisors, third-party administrators, and other intermediaries. Lincoln National Corporation was founded in 1905 and is headquartered in Radnor, Pennsylvania. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/05/29 06:43
End of Day Share Price2020/05/28 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.