Voya Financial (VOYA) AI Stock Analysis

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Voya Financial

(NYSE:VOYA)

64Neutral

Voya Financial's stock score is supported by strong revenue growth and strategic earnings call highlights. However, technical indicators suggest caution due to bearish trends. Valuation remains fair, providing a buffer against operational challenges, particularly in cash flow management and sector-specific pressures.

Positive Factors

Management Strategy

Management provided a sensible turnaround strategy that gives conviction in Voya's long-term growth profile.

Strategic Initiatives

Strategic initiatives in 2025 should help Voya meaningfully rebound from 2024 and set up an attractive growth profile in 2026 and beyond.

Negative Factors

Earnings Expectations

2025 earnings per share are likely to be lower than expectations.

EPS Growth

EPS growth to decelerate through 2026 due to debt issues and integration costs.

Financial Performance

The company has faced material losses from its medical stop-loss product, which could affect future financial performance.

Voya Financial (VOYA) vs. S&P 500 (SPY)

Market Cap

$5.41B

Dividend Yield3.09%

Average Volume (3M)1.08M

Price to Earnings (P/E)9.2

Beta (1Y)1.03

Revenue Growth9.55%

EPS Growth10.22%

CountryUS

Employees10,000

SectorFinancial

Sector Strength78

IndustryFinancial - Conglomerates

Share Statistics

EPS (TTM)6.12

Shares Outstanding95,526,276

10 Day Avg. Volume1,075,388

30 Day Avg. Volume1,082,067

Financial Highlights & Ratios

PEG Ratio0.90

Price to Book (P/B)N/A

Price to Sales (P/S)0.81

Price to Cash Flow (P/CF)20.50

P/FCF Ratio7.20

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$80.90

Price Target Upside42.91% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering11

Voya Financial Business Overview & Revenue Model

Company DescriptionVoya Financial, Inc. is a prominent American financial services company that operates in the sectors of retirement, investment management, and employee benefits. Headquartered in New York City, Voya provides a range of financial products and services including retirement savings plans, investment management, and various insurance products designed to meet the needs of both individual and institutional clients. With a strong emphasis on helping Americans plan, invest, and protect their savings, Voya is committed to delivering comprehensive solutions that enhance financial security.

How the Company Makes MoneyVoya Financial generates revenue primarily through its three main business segments: Retirement, Investment Management, and Employee Benefits. In the Retirement segment, Voya offers a variety of retirement savings products and services, including 401(k) plans, Individual Retirement Accounts (IRAs), and 403(b) plans, earning money through management fees, administrative fees, and other ancillary services. The Investment Management segment involves managing assets for institutional and retail clients, with revenue derived from advisory fees based on assets under management. The Employee Benefits segment offers group life insurance, disability income insurance, and stop-loss insurance, generating income through premiums. Additionally, Voya's earnings are supported by strategic partnerships with businesses and institutions, enhancing its distribution capabilities and market reach.

Voya Financial Financial Statement Overview

Summary

Voya Financial shows strong revenue growth and improved operational efficiency, though profitability and cash flow stability need further enhancement. The balance sheet reflects a reduction in leverage and solid equity positioning, but cash flow challenges persist, necessitating careful management.

Income Statement

Positive

Voya Financial shows strong improvements in revenue, with a notable revenue growth rate of 9.53% from 2023 to 2024. The gross profit margin remains high at 100%, indicating efficient cost management. However, the net profit margin has seen a slight improvement to 9.21% in 2024 from 8.51% in 2023, suggesting room for enhancing profitability further. EBIT margin significantly improved to 61.70% in 2024, indicating better operational efficiency.

Balance Sheet

Positive

The company's debt-to-equity ratio has improved to 0.61, reflecting a reduction in leverage risk. The return on equity (ROE) stands at 18.53% for 2024, showing strong returns on shareholder investments despite a decline from previous years. The equity ratio is at 60.72%, indicating a solid equity base relative to total assets.

Cash Flow

Neutral

The cash flow situation shows challenges, with free cash flow data unavailable for 2024. The operating cash flow to net income ratio in previous years indicated variability, and without current data, assessing cash flow health remains difficult. The company needs to ensure stable cash flow generation to support operations and growth.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
8.05B	7.35B	5.90B	3.25B	7.39B
	Gross Profit
8.05B	7.35B	5.90B	3.25B	7.39B
	EBIT
4.97B	729.00M	716.00M	1.45B	-549.00M
	EBITDA
0.00	991.00M	629.00M	3.02B	584.00M
	Net Income Common Stockholders
667.00M	625.00M	510.00M	2.37B	370.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
237.00M	937.00M	2.52B	2.94B	46.33B
	Total Assets
6.59B	157.09B	147.65B	171.26B	180.31B
	Total Debt
2.45B	3.43B	2.23B	2.60B	3.04B
	Net Debt
2.23B	2.31B	1.32B	1.19B	1.54B
	Total Liabilities
2.59B	151.03B	141.53B	161.44B	169.00B
	Stockholders Equity
4.00B	4.19B	4.47B	8.25B	10.24B
Cash Flow		Free Cash Flow
911.00M	1.64B	1.35B	556.00M	1.21B
	Operating Cash Flow
911.00M	1.64B	1.35B	72.00M	1.21B
	Investing Cash Flow
-141.00M	2.53B	-1.95B	-327.00M	-2.46B
	Financing Cash Flow
-759.00M	-4.06B	28.00M	-265.00M	1.70B

Voya Financial Technical Analysis

Technical Analysis Sentiment

Negative

Last Price56.61

Price Trends

50DMA

69.66

Negative

100DMA

71.67

Negative

200DMA

72.29

Negative

Market Momentum

MACD

-0.51

Negative

RSI

45.35

Neutral

STOCH

28.12

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VOYA, the sentiment is Negative. The current price of 56.61 is below the 20-day moving average (MA) of 67.15, below the 50-day MA of 69.66, and below the 200-day MA of 72.29, indicating a bearish trend. The MACD of -0.51 indicates Negative momentum. The RSI at 45.35 is Neutral, neither overbought nor oversold. The STOCH value of 28.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for VOYA.

Voya Financial Risk Analysis

Voya Financial disclosed 10 risk factors in its most recent earnings report. Voya Financial reported the most risks in the “Macro & Political” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Voya Financial Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MTG	77 Outperform	$5.61B	8.01	14.90%	2.18%	4.56%	15.94%
SLM	76 Outperform	$5.76B	10.20	30.11%	1.88%	4.90%	11.33%
JXN	76 Outperform	$5.11B	5.99	9.49%	4.12%	3.55%	8.91%
SIGI	75 Outperform	$5.25B	26.74	6.82%	1.69%	15.35%	-44.64%
PFSI	66 Neutral	$5.33B	17.77	8.45%	1.06%	42.36%	110.48%
VOYA	64 Neutral	$5.41B	9.17	16.27%	3.09%	9.55%	10.22%
Sector *	63 Neutral	$12.86B	9.17	9.14%	4.78%	16.41%	-10.11%

* Financial Sector Average

Performance Comparison

VOYA

Voya Financial

56.61

-12.77

-18.41%

MTG

MGIC Investment

23.14

2.78

13.65%

SIGI

Selective Insurance Group

86.33

-17.29

-16.69%

SLM

25.54

4.47

21.21%

PFSI

PennyMac Financial

103.69

14.66

16.47%

JXN

Jackson Financial Incorporation

70.35

6.35

9.92%

Voya Financial Earnings Call Summary

Earnings Call Date: Feb 4, 2025 | % Change Since: -16.75% | Next Earnings Date: May 6, 2025

Earnings Call Sentiment Neutral

The earnings call reflected strong growth and earnings in Wealth Solutions and Investment Management, with strategic capital returns and investments marked as positive developments. However, challenges in Health Solutions and expectations of lower prepayment income present concerns, balancing the overall sentiment.

Highlights

Strong Earnings and Growth in Wealth Solutions

Earnings for Wealth Solutions were up 30% year-over-year, with revenue growth and adjusted operating margin exceeding 2024 full year targets. Wealth Solutions generated $2 billion of defined contribution net flows in 2024.

Investment Management Success

Voya Investment Management's earnings were up 20% year-over-year, and the company achieved an organic growth rate above 4% for 2024, exceeding targets with positive net flows for four consecutive quarters.

Capital Return and Strategic Investments

Returned $800 million of excess capital to shareholders in 2024 through share repurchase and dividends. Closed OneAmerica transaction, adding $60 billion in assets and nearly $4 billion of spread-based assets under management.

Sconset Re Investment

Closed on an anchor equity investment in Sconset Re, providing an attractive investment return and strategic benefits, including growth in the annuities market and strengthening the relationship with Allianz.

Lowlights

Challenges in Health Solutions

The Stop Loss results were in line with expectations, but corrective actions were needed, including rate increases and strengthened underwriting risk selection. Higher loss ratios impacted results, with a reported fourth quarter loss ratio above 95%.

Lower Prepayment Income Expectations

Prepayment income remains below long-term expectations due to the higher interest rate environment, with expectations for continued lower prepayment income in 2025.

Impact of Venerable Outflows

Significant outflows from divested businesses, including $6.8 billion expected in the second half of 2025, impacting asset growth despite positive net flows.

Company Guidance

In the Voya Financial Fourth Quarter 2024 Earnings Conference Call, the company provided guidance indicating strong performance across Wealth Solutions and Investment Management. Wealth Solutions experienced a 30% year-over-year earnings increase, with $2 billion in defined contribution net flows and adjusted operating margins surpassing targets. Investment Management also recorded a 20% increase in earnings and an organic growth rate above 4%, marking its best year for net flows. However, Health Solutions faced challenges with Stop Loss results, which were in line with December's expectations. The company is addressing this through rate increases and improved risk selection, expecting a 5% to 15% improvement in the loss ratio for 2025. Additionally, Voya closed its OneAmerica transaction, adding $60 billion in assets, and plans to return $800 million to shareholders while investing in growth areas like leave management and disability administration. Management anticipates generating approximately $750 million in excess capital in 2025, with a balanced approach to growth investments and capital returns.

Voya Financial Corporate Events

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures

Voya Financial Reports Strong 2024 Results and Acquisition

Positive

Feb 4, 2025

Voya Financial reported strong financial results for the fourth quarter and full year of 2024, with notable growth in Wealth Solutions and Investment Management offset by higher loss ratios in Health Solutions. The company returned $800 million in capital to shareholders and completed the acquisition of OneAmerica Financial’s retirement plan business, which is expected to enhance its industry positioning. Despite challenges in Health Solutions, Voya expects improved profitability in 2025 through core business growth and strategic acquisitions.

Financial Disclosures

Voya Financial Manages $339 Billion in Assets by 2024

Neutral

Jan 29, 2025

As of December 31, 2024, Voya Financial reported that its Investment Management segment managed assets totaling $339 billion. This figure includes various asset types such as equity, fixed income, alternative, and money market assets, with significant portions attributed to both institutional and retail external client assets. This disclosure precedes the company’s upcoming quarterly earnings release and provides insight into the company’s asset allocation and market positioning.

Financial Disclosures

Voya Financial Projects Lower Q4 Investment Income

Negative

Jan 8, 2025

Voya Financial has reported an estimated alternative investment income and prepayment fees for the fourth quarter of 2024, which are approximately $8 million to $16 million below long-term expectations. The preliminary results are subject to final financial closing procedures, and the company advises caution as these figures have not been audited or reviewed by Ernst & Young LLP.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.