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F&G Annuities & Life Inc (FG)
NYSE:FG
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F&G Annuities & Life Inc
(NYSE:FG)
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Rating:77Outperform
Price Target:
$31.00
▲(21.66% Upside)
Action:ReiteratedDate:12/19/25
F&G Annuities & Life Inc receives a strong overall score due to its robust financial performance, attractive valuation, and positive corporate events. The earnings call and technical analysis further support the stock's potential, despite some challenges in profitability and cash flow growth.
Positive Factors
Scale & Distribution Strength
Sizable and growing AUM plus strong gross sales indicate durable distribution reach and product demand. Scale supports diversified investment income, improves hedging economics and allows cross-selling across annuity and life products, underpinning steady long-term revenue and fee opportunities.
Capital-light fee income & reinsurance sidecar
Growing fee-based flow reinsurance and a reinsurance sidecar shift earnings toward capital-light, higher-margin streams. This reduces balance-sheet capital strain, improves ROA/ROE potential and creates repeatable, less capital-intensive growth that can sustainably boost profitability over multiple years.
High-quality investment portfolio
A predominantly investment-grade fixed income book limits credit losses and supports predictable long-duration yields. Low historical credit impairments reduce volatility in investment spreads and enhance the durability of net investment income, a core profit driver for annuity and life insurers.
Negative Factors
Declining free cash flow growth
A near-20% drop in free cash flow growth weakens the firm's capacity to self-fund capital returns, product development and balance-sheet cushioning. Over a multi-quarter horizon this can constrain dividend policy flexibility, reduce reinvestment ability and pressure liquidity metrics during stress.
Rising amortization & pressured returns
Incremental amortization charges compress reported earnings and reduce adjusted ROE and net margins. Sustained higher amortization burdens limit operating leverage benefits from sales growth and can delay improvements in return metrics even as core revenue and AUM expand.
Competitive pressure in MYGA market
Intensifying competition for multi-year guaranteed annuities can erode pricing spreads and sales mix. Since MYGAs are a core product, sustained pricing pressure risks lower new business profitability and could force higher capital requirements or product redesigns to preserve margins over several quarters.
F&G Annuities & Life Inc (FG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.88B
Dividend Yield2.91%
Average Volume (3M)588.09K
Price to Earnings (P/E)8.6
Beta (1Y)1.09
Revenue Growth-4.58%
EPS GrowthN/A
CountryUS
Employees1,300
SectorFinancial
Sector Strength70
IndustryInsurance - Life
Share Statistics
EPS (TTM)0.91
Shares Outstanding134,619,540
10 Day Avg. Volume435,920
30 Day Avg. Volume588,089
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)1.31
Price to Sales (P/S)0.96
P/FCF Ratio0.87
Enterprise Value/Market Cap1.08
Enterprise Value/Revenue0.80
Enterprise Value/Gross Profit2.60
Enterprise Value/Ebitda3.03
Forecast
1Y Price Target
$32.00Price Target Upside25.59% Upside
Rating ConsensusHold
Number of Analyst Covering2
EPS Forecast (FY)5.67
Revenue Forecast (FY)$6.25B
F&G Annuities & Life Inc Business Overview & Revenue Model
Company DescriptionF&G Annuities & Life, Inc. provides fixed annuities and life insurance products. It serves retail annuity and life customers, as well as institutional clients. The company was founded in 1959 and is headquartered in Des Moines, Iowa. F&G Annuities & Life, Inc. is a subsidiary of Fidelity National Financial, Inc.
How the Company Makes MoneyF&G Annuities & Life Inc generates revenue through several key streams. Primarily, the company earns income from the sale of its annuity and life insurance products, which involve collecting premiums from policyholders. The company invests these premiums in various financial instruments, generating investment income that contributes significantly to its overall revenue. Additionally, F&G may earn fees from managing its investment portfolio and from the administration of its insurance products. Strategic partnerships with financial advisors and broker-dealers enhance distribution channels, further increasing sales and market reach. Overall, the company's revenue model relies on a combination of premium collection, investment income, and service fees, which collectively support its financial performance.
F&G Annuities & Life Inc Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 13, 2026
Earnings Call Sentiment Positive
The call emphasized multiple material positives: record AUM, robust gross sales (including core products), improved expense efficiency, strong statutory capital (RBC ~430%), and growing fee-based income (flow reinsurance and owned distribution). Management acknowledged underperformance in alternative investment returns (approximately 7% vs a 10% long-term target) with a significant FY shortfall ($278M) and flagged near-term variability from surrenders and prepayments as potential headwinds. The company is taking disclosure and strategic actions (reclassifying alternative returns, selling an offshore legal entity, optimizing product mix, and pursuing FABN issuances) to strengthen financial flexibility and investor clarity. Overall, the positive operational and capital achievements outweigh the challenges tied to alternative returns and short-term volatility, with management projecting continued progress toward fee-based, higher-margin earnings.Q4-2025 Updates
Positive Updates
Record AUM and Midpoint Progress Toward Targets
Achieved record AUM before flow reinsurance of $73.1B (up 12% vs year-end 2024) and retained AUM of $57.6B (up 7% vs year-end 2024). AUM grew from a $51B 2020 baseline to $73B at year-end 2025 (a 44% increase toward the five-year 50% target).
Strong Sales Performance
Generated $14.6B of gross sales for FY2025 (second highest year on record), including $9.0B in core product sales and $5.6B in opportunistic sales. Q4 gross sales were $3.4B with core Q4 sales of $2.8B (up 27% sequentially from Q3).
Core Product Momentum
Indexed annuities $6.7B for FY2025 (in line with 2024) with Q4 indexed annuity sales of $1.9B (up 12% YoY). Indexed universal life (IUL) sales $190M for the year (up 14% YoY). Pension risk transfer (PRT) sales $2.1B for the year (third consecutive year ≥ $2B).
Improving Expense Efficiency
Operating expense ratio to AUM before flow reinsurance improved to 50 basis points at year-end 2025 from 60 basis points in 2024 (a 10 bps improvement). Company targets ~45 bps by year-end 2027.
High-Quality Investment Portfolio and Credit Metrics
Retained fixed maturities were 97% investment grade at year-end 2025. Private origination portfolio ~92% investment grade. Credit-related impairments remained stable at 8 basis points in 2025. Fixed income yield was 4.65% in Q4, up 6 bps YoY.
Growing Fee-Based Earnings
Fee income from flow reinsurance rose to $56M for FY2025 (up 37% vs $41M in 2024). Owned distribution margin contributed $47M (up 2% YoY). Fee-based strategies accounted for ~15% of adjusted net earnings in 2025 and management expects ~25% by year-end 2028.
Solid Adjusted Earnings and Capital Actions
Reported adjusted net earnings of $482M for FY2025 ($3.64 per share) and $123M in Q4 ($0.91). Company returned $137M of capital to shareholders in 2025, increased quarterly common dividend by 14% in Q4, and reported GAAP common equity excluding AOCI of $6.0B with book value per share excluding AOCI of $44.43 (up 62% since 2020 acquisition).
Strong Statutory Capital and Deleveraging Plan
Primary operating subsidiary company action level RBC approx. 430% (above 400% target). Targeting ~25% debt to capitalization excluding AOCI and expect balance sheet to naturally delever over time. Annualized interest expense ~$165M on $2.3B total debt.
Strategic Capital Transaction
On track to sell Bermuda legal entity F&G Life Re Limited to Ancient Financial Holdings LP (effective March 1). Recaptured ~$900M of affiliated statutory liabilities; expect net proceeds ≈ $300M (including a $200M dividend already reflected at year-end). Transaction provides capital transfer and counterparty diversification for MYGA flow reinsurance.
Negative Updates
Alternative Investment Returns Below Long-Term Expectations
Annualized return on alternative investments was ~7% in Q4 versus a 10% long-term expected return. Alternative investment income missed management expectations by $65M in Q4 and by $278M for the full year, prompting a disclosure change to reclassify ~60% (~$7B) of alternatives into fixed income yield for better comparability.
Decline in MYGA Volumes
MYGA sales were $3.8B for FY2025 versus $5.1B in 2024 (down about 25% YoY) as the company intentionally moderated MYGA volumes in favor of more attractive capital deployment and flow reinsurance optimization.
Slight Decline in Net Retained Sales
Net sales retained totaled $10.0B for FY2025 compared with $10.6B in FY2024 (down roughly 5.7%), with Q4 net sales of $2.3B down slightly YoY.
Earnings Variability Risk from Surrenders and Prepayments
Elevated annuity terminations have boosted earnings via surrender charge income but can pressure near-term spreads; management expects potential quarterly variability in 2026. Prepayment fees totaled $56M for the year (in line with 2024), but management notes prepayment volatility could be a headwind in 2026.
One-Time and Foregone Earnings Items
Full year adjusted net earnings included $30M of favorable significant items (one-time). The sale of the Bermuda legal entity will reduce AUM by ~$1.9B and forego annual adjusted net earnings of about $40M (~$10M per quarter) prior to redeploying proceeds.
Market Valuation Disconnect
Management noted the stock traded at a steep discount to book (cited as ~$0.62 of book value), reflecting investor concern about credit exposure and alternative assets despite strong statutory metrics; this valuation pressure is a potential headwind for shareholder perception.
Alternative Income Sensitivity to Market Conditions
Variable investment income and private asset realizations are sensitive to market activity (IPOs, transaction volume). Management plans conservatism in planning given variability and noted realizations in the PE portfolio have been muted recently, impacting capital generation dynamics.
Company Guidance
Management reiterated guidance to continue shifting to a more fee‑based, higher‑margin, less capital‑intensive model while growing AUM and improving returns: FY‑25 AUM before flow reinsurance was $73.1B (+12% YoY) with retained AUM $57.6B (+7%), $14.6B gross sales ($9.0B core; $5.6B opportunistic), net retained sales $10.0B, and progress toward the 2023 Investor Day targets (AUM +44% from the $51B baseline toward a 50% five‑year goal; ROA and ROE moving toward the lower ends of the 133–155 bps and 13–14% targets). Key operational and capital targets included growing fee‑based earnings from ~15% of adjusted net earnings in 2025 (flow reinsurance fees $56M, owned distribution $47M) to ~25% by year‑end 2028, lowering operating expense to AUM before flow reinsurance from 50 bps (down from 60 bps) to ~45 bps by 2027, reinsuring the vast majority of MYGA while evolving FIA toward ~50/50 retained vs. flow, maintaining debt around a ~25% debt‑to‑capitalization target, holding company cash ~2x interest coverage, sustaining strong statutory capital (company action level RBC ~430% vs 400% target), and executing a transaction expected to deliver ~$300M net proceeds (including a $200M dividend), reduce AUM by ~$1.9B and forego ~ $10M of adjusted net earnings per quarter pre‑deployment; other portfolio metrics noted: Q4 fixed‑income yield 4.65% (+6 bps YoY), alt‑investments annualized ~7% (vs 10% long‑term), floating‑rate exposure ~$2.8B (~5%), prepayment fees $7M pretax Q4 ($56M FY), FY adjusted net earnings $482M ($3.64/share) and Q4 $123M ($0.91/share).F&G Annuities & Life Inc Financial Statement Overview
Summary
F&G Annuities & Life Inc demonstrates solid revenue growth and operational efficiency, though profitability margins have seen some pressure. The balance sheet is stable with moderate leverage, and while cash flow generation is strong, recent declines in free cash flow growth warrant attention. Overall, the company is in a stable financial position but should focus on improving profitability and cash flow growth.Income Statement
F&G Annuities & Life Inc has shown a consistent revenue growth trajectory, with a TTM revenue growth rate of 4.85%. The gross profit margin is healthy at 22.25% for TTM, although it has decreased from previous years. The net profit margin has also decreased to 8.72% TTM, indicating some pressure on profitability. However, the company maintains a solid EBIT margin of 13.81% and an EBITDA margin of 22.51% TTM, reflecting operational efficiency.75
Positive
Balance Sheet
The company has a moderate debt-to-equity ratio of 0.46 TTM, indicating a balanced approach to leverage. The return on equity has decreased to 10.56% TTM, suggesting reduced profitability relative to equity. The equity ratio stands at 5.02%, indicating a stable capital structure. Overall, the balance sheet reflects a stable financial position with manageable debt levels.70
Positive
Cash Flow
The free cash flow growth rate has declined by 19.26% TTM, which is a concern. However, the company maintains a strong free cash flow to net income ratio of 99.60% TTM, indicating efficient cash generation relative to net income. The operating cash flow to net income ratio is not available, which limits a full assessment of cash flow efficiency.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.23B | 5.42B | 4.27B | 2.24B | 3.38B | 1.43B |
| Gross Profit | 1.61B | 1.63B | 718.00M | 1.11B | 1.45B | 1.43B |
| EBITDA | 1.38B | 1.48B | 474.00M | 1.15B | 1.85B | 0.00 |
| Net Income | 464.00M | 639.00M | -58.00M | 635.00M | 1.24B | -178.00M |
Balance Sheet | ||||||
| Total Assets | 96.14B | 85.04B | 70.20B | 54.63B | 48.73B | 39.76B |
| Cash, Cash Equivalents and Short-Term Investments | 30.20B | 48.58B | 43.43B | 33.73B | 31.87B | 26.84B |
| Total Debt | 2.24B | 2.18B | 1.76B | 1.13B | 991.00M | 603.00M |
| Total Liabilities | 91.20B | 80.96B | 67.10B | 52.22B | 44.24B | 35.68B |
| Stockholders Equity | 4.82B | 3.95B | 3.10B | 2.40B | 4.49B | 4.07B |
Cash Flow | ||||||
| Free Cash Flow | 4.82B | 5.97B | 5.81B | 3.14B | 1.84B | 35.00M |
| Operating Cash Flow | 4.83B | 6.00B | 5.83B | 3.17B | 1.87B | 63.00M |
| Investing Cash Flow | -8.95B | -7.95B | -8.92B | -9.37B | -6.86B | -2.59B |
| Financing Cash Flow | 2.77B | 2.65B | 3.69B | 5.63B | 5.63B | 2.52B |
F&G Annuities & Life Inc Technical Analysis
Negative
25.48
Price Trends
29.72
Negative
30.15
Negative
31.18
Negative
Market Momentum
-0.52
Positive
32.25
Neutral
39.54
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FG, the sentiment is Negative. The current price of 25.48 is below the 20-day moving average (MA) of 28.30, below the 50-day MA of 29.72, and below the 200-day MA of 31.18, indicating a bearish trend. The MACD of -0.52 indicates Positive momentum. The RSI at 32.25 is Neutral, neither overbought nor oversold. The STOCH value of 39.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FG.
F&G Annuities & Life Inc Risk Analysis
F&G Annuities & Life Inc disclosed 66 risk factors in its most recent earnings report. F&G Annuities & Life Inc reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
F&G Annuities & Life Inc Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $3.88B | 8.60 | 6.05% | 2.91% | -4.58% | ― | |
74 Outperform | $3.66B | 4.34 | 16.27% | ― | 27.71% | ― | |
72 Outperform | $7.95B | -336.71 | 0.27% | 2.98% | 24.94% | ― | |
71 Outperform | $4.10B | 18.74 | 11.12% | 1.54% | -1.61% | 15.79% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
63 Neutral | $3.54B | 16.62 | 2.86% | ― | 1.41% | 150.35% | |
63 Neutral | $7.95B | 7.17 | 12.27% | 3.93% | 35.76% | 636.97% |
* Financial Sector Average
FG
F&G Annuities & Life Inc
25.48
-14.36
-36.04%
CNO
CNO Financial
43.22
3.76
9.53%
GNW
Genworth Financial
8.78
2.21
33.64%
LNC
Lincoln National
39.90
4.28
12.03%
BHF
Brighthouse Financial
63.93
4.49
7.55%
JXN
Jackson Financial Incorporation
115.62
34.94
43.30%
F&G Annuities & Life Inc Corporate Events
Business Operations and StrategyDividends
F&G Shares Set for Special Distribution to FNF Holders
Positive
Dec 18, 2025
On December 18, 2025, Fidelity National Financial, Inc. (FNF), the majority owner of F&G Annuities & Life, announced that its board had set the final terms for a special stock distribution of F&G shares to FNF investors. The transaction will see FNF distribute 16,280,204 F&G shares—around 12% of F&G’s outstanding stock—to FNF shareholders of record as of 4:30 p.m. ET on December 17, 2025, with distribution scheduled for December 31, 2025. Based on FNF’s 271.3 million shares outstanding on the record date, investors will receive six F&G shares for every 100 FNF shares held, with cash paid in lieu of fractional F&G shares. The move further broadens F&G’s shareholder base while modestly reducing FNF’s majority stake, and the distribution, structured as a taxable dividend for U.S. federal income tax purposes, gives FNF shareholders direct exposure to F&G’s insurance and annuity business without requiring any action or payment on their part.
The most recent analyst rating on (FG) stock is a Buy with a $37.00 price target. To see the full list of analyst forecasts on F&G Annuities & Life Inc stock, see the FG Stock Forecast page.
Business Operations and Strategy
F&G Annuities Announces Special Stock Distribution
Positive
Nov 10, 2025
On November 7, 2025, F&G Annuities & Life, Inc. announced a special stock distribution of approximately 16 million shares of its common stock by its majority-owned parent, Fidelity National Financial, Inc., to FNF shareholders. This distribution, representing about 12% of F&G’s outstanding shares, is intended to enhance market liquidity and broaden investor access to F&G’s shares, reflecting FNF’s confidence in F&G’s long-term prospects. The distribution is scheduled for December 31, 2025, with FNF shareholders receiving approximately six shares of F&G for every 100 shares of FNF held.
The most recent analyst rating on (FG) stock is a Buy with a $34.00 price target. To see the full list of analyst forecasts on F&G Annuities & Life Inc stock, see the FG Stock Forecast page.
Business Operations and StrategyFinancial Disclosures
F&G Annuities Reports Strong Q3 2025 Financial Results
Positive
Nov 6, 2025
On November 6, 2025, F&G Annuities & Life reported its financial results for the third quarter ended September 30, 2025, showcasing a significant turnaround with net earnings of $114 million compared to a net loss of $10 million in the same quarter of 2024. The company achieved record assets under management of $71.4 billion, driven by strong sales and the successful launch of a new reinsurance sidecar, which is expected to provide long-term growth capital. F&G’s strategic focus on organic growth and capital returns to shareholders, along with disciplined expense management, has positioned it well in the industry, as evidenced by its improved operating expense ratio and strong investment portfolio performance.
The most recent analyst rating on (FG) stock is a Buy with a $33.00 price target. To see the full list of analyst forecasts on F&G Annuities & Life Inc stock, see the FG Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.