lost ground after the insurance giant reported late Wednesday a 44% drop in net income in the second quarter, largely due to investment losses it realized in the period.
Operating earnings, which exclude losses on investments and other charges, rose 20%. But even by that basis, earnings still fell short of Wall Street expectations at the Newark, N.J.-based firm.
In the quarter, Prudential's net income was $424 million, or 89 cents a share, compared with $754 million, or $1.48 a share, a year ago. On an operating basis, the firm earned $682 million, or $1.40 a share, compared with $568 million, or $1.12 a share a year ago. Total revenue rose 7% to $6.04 billion. Analysts, as surveyed by Thomson Financial, were looking for operating earnings of $1.44 a share on revenue of $6.1 billion. Prudential also lowered its full-year earnings outlook. Shares slipped $4.23, or 5.40%, to $74.05 recently.
National Financial Partners
plummeted after the New York-based insurer missed Wall Street's second-quarter expectations, despite a 10% rise in earnings. The company earned $13.7 million, or 34 cents a share, up from $12.4 million, or 32 cents a share, a year ago. Cash earnings increased 10.3% to 64 cents a share. Revenue increased 28.1% to $262.3 million. But analysts were looking for earnings of 68 cents a share.
"We continue to target 20% cash earnings per share growth over the long term," said Jessica Bibliowicz, chairman and CEO, in a statement, "although our extremely strong growth in the second half of 2005 presents challenging comparisons in the second half of 2006." Shares sank $6.56, or 14.63%, to $38.27 recently.
Willis Group Holdings
gained after the London-based insurance broker beat Wall Street's second-quarter earnings expectations, even though earnings fell from a year ago.
The company earned $72 million, or 45 cents a share, compared with $114 million, or 70 cents a share. Revenue increased 8% over a year ago to $593 million. Analysts polled by Thomson First Call were looking for earnings of 42 cents a share. The year-ago quarter included a $78 million gain from the sale of Stewart Smith, its wholesale operations. For the full year 2006, Willis Group said it anticipates continued growth in organic commissions and fees.
In the third quarter, Willis expects to incur certain one-time expenses related to the company's strategic initiatives. The company also approved a new $1 billion stock buyback plan taht replaces the company's previously announced $500 million buyback plan and its remaining $140 million authorization. Shares gained $3, or about 9%, to $36.26 recently.
Marsh & McLennan
stumbled after the financial services firm posted weaker-than-expected second-quarter earnings.
The company reported earnings from continuing operations of $173 million, or 31 cents a share, including one-time items that cut profits by $46 million, or 5 cents a share. Analysts expected earnings of 44 cents a share. Marsh recorded total revenue of $2.98 billion, compared with Wall Street's forecast of $2.99 billion. A year earlier, earnings from continuing operations were $160 million, or 30 cents a share, on revenue of $2.98 billion. Shares slipped $2, or 7.44%, to $24.89 recently.
swung to a loss in the second quarter and said revenue declined from the year-ago period. The New York-based specialist firm lost $22.4 million, or 37 cents a share, in the quarter, compared with earnings of $8.7 million, or 14 cents a share, a year ago.
Excluding the loss attributable to the decline in value of LaBranche's
New York Stock Exchange
restricted shares, the company's net operating loss for the second quarter was $5.3 million, or 9 cents a share. Second-quarter revenue dropped more than 30% from a year ago to $53.2 million, largely because of a nearly 50% decline in net gains on principal transactions. Shares dropped 41 cents, or 4.27%, to $9.20 recently.