First Take 2Q26 Earnings: Strong Earnings, But Weaker Flows

Research evidence excerpt

First Take 2Q26 Earnings: Strong Earnings, But Weaker Flows

Update

July 30, 2026 11:25 AM GMT

Morgan Stanley & Co. LLCMLincoln National Corp | North America Bob Jian Huang

Equity Analyst

First Take 2Q26 Earnings: Bob.Huang@morganstanley.comJie Cheng +1 212 761-6136

Research Associate

Jie.Cheng1@morganstanley.com +1 212 761-3878

Strong Earnings, But Weaker

Lincoln National Corp (LNC.N, LNC UN)

Insurance - Life/Annuity | United States of AmericaFlows

Stock Rating Overweight

Industry View Attractive

Price target $40.00

AlphaSignals Earnings Reaction Shr price, close (Jul 29, 2026) $41.43

Mkt cap, curr (mm) ND

Unchanged Modest upside Largely unchanged 52-Week Range $46.82-32.20

Impact to our thesis Financial results versus consensus Direction of next 12-month

consensus EPS

Source: Company data, Morgan Stanley Research

Mortality and market supported earnings, but flows appear weak. Lincoln saw

strong results driven by the favorable mortality trends in Life Insurance and Group

Protection as well as strong market performance that supported the Retirement

business. The broad-based strength in earnings is likely durable given the current

mortality trend, and both equity and fixed income markets have been robust thus

far. That said, the net flows in traditional VA, RILA and fixed annuities are all weaker

than expected. Given the solid results, the key for Lincoln going forward will be how

the company manages its capital and ultimately return capital to shareholders.

What We Liked

• Life Insurance: Reported earnings of $57 million is above consensus/MSe of

$18 million/$33 million on favorable mortality and 4Q25 captive

consolidation, partially offset by $(40) million lower alternative investment

income. Sales of $216 million vs. $121 million YoY, up 79% driven by