VOYA: 1Q26 review; updating our estimates

Research evidence excerpt

VOYA: 1Q26 review; updating our estimates

rve 2026 2.26A 2.45E 2.41E 2.34E

release: Employee Benefits stop-loss loss ratio of 80% was better than Prev. 2.00E 2.66E 2.62E 2.51E

our 81.5% estimate, though there was benefit from a reserve release in BVPS Diluted

2025 62.55A 64.60A 65.81A 66.74A the quarter; loss pick for the 2026 PY business is being set at 87%, which 2026 68.39A 70.31E 72.27E 74.13E

is higher than our previously published full year 2026 stop-loss loss ratio Prev. 68.23E 70.40E 72.59E 74.64E

assumption; we have revised our stop-loss loss ratios upwards to 87%

for 2026E though mgmt's comments suggest VOYA is setting reserves at AllPricedvaluesas ofin priorUSD unlesstradingotherwiseday's marketnoted.close, EST (unless otherwise noted).

the higher end of pot'l outcomes and there is pot'l for reserve releases

as claims experience emerges. Group life loss ratio was better than we

expected, driven by favorable experience (both frequency and severity).

Importantly, mgmt emphasized stop-loss is a 'door opener' and helps

VOYA deepen its customer relationships; it remains a strategic asset for

VOYA and mgmt believes is the most significant shareholder value creation

opportunity currently. Recall, activist investor TOMS Capital is pushing for

changes. Overall, VOYA had better than expected 1Q results. EPS beat

mainly driven by better than expected Employee Benefits op earnings, with

net underwriting gains, with a reserve release in stop-loss a contributor,

and lower than expected admin expenses the key drivers. Retirement

op earnings were a little light vs our estimate, mainly driven by slightly

higher than expected admin expenses. Net flows: Full-service net outflows

of $4.3bn were higher than our $2.1bn net outflow estimate; some