BWS Financial posts record earnings and a $3.2B State Farm acquisition

BWS Financial has reported strong financial results for the latest quarter, with earnings rising across its key divisions. The company also announced a major acquisition worth $3.2 billion, set to expand its insurance portfolio. Meanwhile, its asset management and wealth solutions segments showed significant growth in both revenue and client inflows.

The company's Distributable Earnings Before Realizations reached $1.3 billion for the quarter, a 13% per-share increase to $0.80. Over the past 12 months, this figure totalled $5.3 billion, or $3.36 per share. Total Distributable Earnings followed a similar trend, hitting $1.4 billion ($0.88 per share) this quarter and $5.9 billion ($3.71 per share) annually. Net income for the trailing year stood at $2.9 billion.

Asset management performed particularly well, with quarterly earnings of $650 million ($0.41 per share) and $2.7 billion ($1.72 per share) over 12 months. The division also saw $22 billion in inflows, including over $5 billion from retail and wealth solutions clients. Fee-bearing capital grew to $563 billion, driving a 16% rise in fee-related earnings to $676 million.

In insurance, BWS originated over $4 billion in annuities during the quarter, pushing total insurance assets to $135 billion. The investment portfolio yielded 5.8%, with spread earnings 1.8% above the average cost of funds. Return on equity remained aligned with the company's long-term target of 15% or higher.

The firm also confirmed its $3.2 billion acquisition of State Farm, financed two-thirds by credit and the rest from existing cash. The deal is expected to add $40 billion in insurance assets while targeting returns consistent with a 15%+ return on equity. Separately, BWS Financial issued a 'Sell' rating on Yahoo Finance, which is acquiring Seemann Composites and MSC for $220 million.

The latest results highlight BWS Financial's growth in asset management, wealth solutions, and insurance. The State Farm acquisition will further expand its insurance holdings, while strong earnings and inflows reinforce its market position. The company's return on equity remains in line with its long-term financial targets.