Credit Suisse Reiterates Outperform, Lowers Price Target On Prudential Financial Following 4Q14 Earnings Miss

In a report published Thursday, Credit Suisse analyst Thomas Gallagher reiterated an Outperform rating on

, but lowered the price target from $97.00 to $94.00. In the report, Credit Suisse noted, "PRU reported a 4Q 14 earnings miss of $2.12, compared to our estimate of $2.40 and consensus of $2.38. While PRU defines core EPS as $2.33 after adjusting for certain one-time items, backing out some other favorable items that we would not view as sustainable, such as higher than expected prepayment and alternative investment income and favorable mortality takes the EPS run rate back down to $2.17 per share. The main sources of the miss vs. our estimate were higher expenses in Japan and US annuities, and lower transaction fees within asset management. While we have seen a more pronounced seasonal earnings pattern for PRU over the last few years, and don't believe the 6% miss necessary needs to be fully run-rated – we are lowering estimates by 49c in 2015 (to $9.70) and by 33c in 2016 (to $10.40) - which still leaves us within PRU's guidance range, but now toward the lower end." Prudential Financial closed on Wednesday at $79.89.