Sun Life (SLF) Down 8.6% Since Last Earnings Report: Can It Rebound?

It has been about a month since the last earnings report for Sun Life (SLF). Shares have lost about 8.6% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Sun Life due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for Sun Life Financial Inc. before we dive into how investors and analysts have reacted as of late.

Sun Life Financial Q4 Earnings Beat Estimates, Revenues Rise Y/Y

Sun Life Financial Inc. delivered a fourth-quarter 2025 underlying net income of $1.41 per share, which beat the Zacks Consensus Estimate by 4.4%. The bottom line increased 17.5% year over year. The underlying net income was $784.6 million (C$1 billion), which increased 13.7% year over year. The increase was attributable to solid results in asset management and wealth, Group-health and protection, and Individual-protection. Revenues increased 16.5% year over year to $6.2 billion. Wealth sales & asset management gross flows decreased 1.6% year over year to $42.9 billion (C$59.8 billion) in the quarter under review. The new business contractual service margin was $315 million (C$440 million), up 44% year over year.

SLF’s Segment Results

SLF Canada’s underlying net income increased 14.2% year over year to $299 million (C$417 million), driven by better performance in Wealth & asset management, Group- health and protection and Individual - Protection. Wealth sales & asset management gross flows of $5 billion (C$7 billion) were up 42% year over year.

SLF U.S.’ underlying net income was $210 million, which increased 30.4% year over year. The increase was attributable to solid performance at Group - Health & Protection as well as Individual – Protection.
U.S. group sales of $1.2 billion were up 45%, reflecting medical stop-loss and large case employee benefits sales in Group Benefits, and higher Medicaid sales in Dental.

SLF Asset Management reported an underlying net income of $265 million (C$370 million), which grew 3.1% year over year, driven by higher fee income from higher ANA, partially offset by higher expenses. Asset Management AUM of $827 billion ($1,154 billion) increased 6.1% year over year. SLC Management's AUM increased 4% year over year.

SLF Asia reported an underlying net income of $148.4 million (C$207 million), which grew 18.7% year over year, driven by better results in Individual – Protection. Individual sales of $641 million (C$894 million) were up 49.4%, driven by higher sales in Hong Kong from growth across all channels, higher sales in India and Indonesia primarily from the bancassurance channel, partially offset by lower sales in High Net Worth from the broker channel.

Wealth sales & asset management gross flows grew 8% year over year, driven by higher fixed income and equity fund sales in India, partially offset by lower fixed income fund sales in the Philippines. New business CSM of $215 million (C$300 million) increased 54.6%, driven by higher sales in Hong Kong.

SLF’s Financial Update

Total assets under management were $1.1 trillion (C$1,604.9 billion), which remained flat year over year. Sun Life Assurance’s Life Insurance Capital Adequacy Test (LICAT) ratio was 140% as of Dec. 31, 2025, which contracted 600 basis points (bps) from Dec. 31, 2024. Sun Life Financial’s LICAT ratio was 157%, which expanded 500 bps year over year. The underlying return on equity of 19.1% expanded 260 bps year over year. The leverage ratio of 23.5% deteriorated 340 bps year over year. Sun Life’s return on equity was 15.1% in 2025, which expanded 150 bps year over year.

SLF’s Dividend Update

In the reported quarter, the company’s board of directors approved a dividend of 92 cents per share. The dividend will be paid out on March 31 to shareholders of record as of Feb. 25.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.

VGM Scores

At this time, Sun Life has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. However, the stock has a grade of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Sun Life has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

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Sun Life Financial Inc. (SLF): Free Stock Analysis Report

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