B. Riley FBR analyst Randy Binner lowered his call on the shares of Prudential Financial Inc. to "neutral" from "buy" after the company reported its second-quarter financial results.
Binner noted that Prudential Financial's adjusted operating EPS of $3.14 missed his estimate of $3.25 and the $3.23 consensus estimate. The core EPS result was $3.00 after adjusting for one-time items.
"The result was noisy and featured mortality assumption changes, mixed flow results, and expanded guidance disclosures," Binner said.
Taking into consideration the lower EPS run-rate established with Prudential Financial's results for the first half, Binner cut his EPS estimates. For 2019, he set his projected EPS at $12.30, which is below guidance. He also changed his EPS estimates to $13.45 from $13.85 for 2020 and to $14.45 from $15.00 for 2021.
In downgrading Prudential Financial's rating, Binner also considered the reduced visibility EPS outlook given the changes in the asset management, U.S. life and corporate segments of Prudential Financial.
He lowered his price target on the company to $100 from $122.