Financial services company Primerica (NYSE: PRI) reported revenue ahead of Wall Street’s expectations in Q4 CY2025, with sales up 8% year on year to $853.7 million. Its non-GAAP profit of $6.13 per share was 8% above analysts’ consensus estimates.

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“I am pleased with our 2025 financial results, which reflected the complementary balance of our business model. The Term Life business continues to provide stability through its large in-force block of business, while the Investment and Savings Products business is increasingly driving growth,” said Glenn Williams, Chief Executive Officer of Primerica, Inc.

Company Overview

With a sales force of over 140,000 licensed representatives operating on an independent contractor model, Primerica (NYSE: PRI) provides term life insurance, investment products, and other financial services to middle-income households in the United States and Canada.

Revenue Growth

Insurance companies earn revenue from three primary sources: 1) The core insurance business itself, often called underwriting and represented in the income statement as premiums 2) Income from investing the “float” (premiums collected upfront not yet paid out as claims) in assets such as fixed-income assets and equities 3) Fees from various sources such as policy administration, annuities, or other value-added services. Thankfully, Primerica’s 8.2% annualized revenue growth over the last five years was decent. Its growth was slightly above the average insurance company and shows its offerings resonate with customers.

We at StockStory place the most emphasis on long-term growth, but within financials, a half-decade historical view may miss recent interest rate changes, market returns, and industry trends. Primerica’s annualized revenue growth of 8% over the last two years aligns with its five-year trend, suggesting its demand was stable. Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.

This quarter, Primerica reported year-on-year revenue growth of 8%, and its $853.7 million of revenue exceeded Wall Street’s estimates by 0.8%.

Net premiums earned made up 56.7% of the company’s total revenue during the last five years, meaning Primerica’s growth drivers strike a balance between insurance and non-insurance activities.

While insurers generate revenue from multiple sources, investors view net premiums earned as the cornerstone - its direct link to core operations stands in sharp contrast to the unpredictability of investment returns and fees.

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Net Premiums Earned

Insurers sell policies then use reinsurance (insurance for insurance companies) to protect themselves from large losses. Net premiums earned are therefore what's collected from selling policies less what’s paid to reinsurers as a risk mitigation tool.

Primerica’s net premiums earned has grown at a 6.1% annualized rate over the last five years, slightly worse than the broader insurance industry and slower than its total revenue.

When analyzing Primerica’s net premiums earned over the last two years, we can see that growth decelerated to 3.6% annually. Since two-year net premiums earned grew slower than total revenue over this period, it’s implied that other line items such as investment income grew at a faster rate. While these additional streams certainly contribute to the bottom line, their impact can vary. Some firms have shown greater success and long-term consistency in investing their float compared to peers. However, sharp fluctuations in the fixed income and equity markets can significantly affect short-term performance.

In Q4, Primerica produced $445.9 million of net premiums earned, up 1.3% year on year. But this wasn’t enough juice to meet Wall Street Consensus estimates.

Key Takeaways from Primerica’s Q4 Results

It was good to see Primerica narrowly top analysts’ revenue expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. On the other hand, its net premiums earned missed. Overall, this quarter could have been better. The stock traded up 1.9% to $258.23 immediately following the results.

Big picture, is Primerica a buy here and now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).