Highlights

  • Lincoln National shows 90.06% basic EPS growth, a P/E of 3.47 and PEG of 0.36.
  • Second quarter net income was $1,332 million, against $699 million a year earlier.
  • Lincoln will cede about $5.8 billion of guaranteed universal life reserves to Talcott.
  • Lincoln issued $500 million of 6.800% subordinated notes on June 29, 2026.

Lincoln National (NYSE:LNC) shares were trading at USD 40.58 on October 28, 2026, up 0.48%, alongside one-year basic EPS growth of 90.06%, a trailing twelve-month P/E of 3.47 and an expected-basis PEG of 0.36, the three figures behind its place among undervalued growth stocks. In its latest disclosures, the Radnor-based insurance and retirement group issued $500 million of subordinated notes on June 29, entered a reinsurance agreement with Talcott Financial Group on July 30, and reported second quarter 2026 net income of $1,332 million.

Lincoln National Corporation has its principal executive offices in Radnor, Pennsylvania, and is incorporated in Indiana. It operates multiple insurance businesses through four segments: Annuities, Life Insurance, Group Protection and Retirement Plan Services, with Other Operations covering activities outside those segments. The group uses "Lincoln Financial" as its marketing identity and sells annuities, universal, variable universal and term life insurance, group life, disability and dental coverage, and employer-sponsored retirement plans.

Growth: Second Quarter Net Income, Earnings per Share and Segments

Net income was $1,332 million in the second quarter against $699 million a year earlier, and $1,160 million for six months against a net loss of $23 million. Net income available to common stockholders was $1,321 million against $688 million for the quarter.

Basic earnings per share were $6.85 against $3.88 in the quarter, and diluted earnings per share were $6.72 against $3.80.

Total revenues were $4,542 million against $4,044 million, and income before taxes was $1,643 million against $848 million. The statements show a realized loss of $406 million against $641 million, and a market risk benefit gain of $1,460 million against $940 million.

Total income from operations, the company's segment measure, was $450 million against $438 million. Annuities earned $287 million in both periods, Life Insurance $57 million against $32 million, Group Protection $147 million against $173 million and Retirement Plan Services $49 million against $37 million. Other Operations recorded a loss of $90 million against $91 million.

Valuation: P/E of 3.47, PEG of 0.36 and Balance Sheet Measures

The P/E ratio of 3.47 is measured on trailing twelve-month earnings, and the PEG ratio of 0.36 on expected growth. Total stockholders' equity was $11,349 million at June 30, 2026, against $10,906 million at December 31, 2025, and retained earnings were $9,322 million against $8,386 million.

Operating activities used cash of $420 million in the first six months of 2026, against $741 million provided a year earlier.

Capital Returns, Debt and Liquidity

Lincoln declared a dividend of $0.45 per common share in the quarter and $0.90 for six months, the same as a year earlier. The company did not repurchase common stock in either period, and $714 million remained under its repurchase authorization, which has no expiration date.

Long-term debt was $6,465 million, with current maturities of $400 million for 3.625% senior notes due December 12, 2026. On March 30, 2026, Lincoln refinanced a $150 million term loan due 2027 into a $250 million term loan due March 30, 2031. It intends to use proceeds of the $500 million of 6.800% subordinated notes due July 15, 2056 for general corporate purposes, which may include repurchasing or redeeming preferred stock.

Subsidiaries paid the holding company $310 million in cash dividends and return of capital in the quarter against $170 million, and insurance subsidiaries had access to $2.6 billion through committed repurchase agreements, none used.

Disclosed Risks and Outlook

The company disclosed several legal matters. A putative class action filed in 2023 alleges that Lincoln and Fidelity marketed misleading insurance products; motions to dismiss remain pending and Lincoln said it is vigorously defending the matter. A securities class action was dismissed with prejudice, and the plaintiff has appealed to the Third Circuit. Three consolidated cases were settled on May 19, 2026.

The company disclosed hypothetical after-tax effects on net income of $(825) million from a 10% equity market decrease and $625 million from a 10% increase. A downgrade of its financial strength or credit ratings could trigger terms in derivative and repurchase agreements and affect sales.

Under the Talcott agreement, Lincoln will cede about $5.8 billion of in-force guaranteed universal life statutory reserves and reinsure about $500 million of funding agreement business, while retaining account administration and recordkeeping. The transaction is subject to regulatory approvals and is expected to close in the fourth quarter of 2026, effective October 1, 2026.