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CNA Financial (CNA) Q2 Earnings In Line, Premiums Rise Y/Y
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CNA Financial Corporation (CNA - Free Report) reported second-quarter 2020 core earnings of 36 cents per share, which matched the Zacks Consensus Estimate. The bottom line decreased 66.7% year over year.
The quarterly results suffered substantially from catastrophe losses attributable to COVID-19, civil unrest and weather-related events. Nonetheless, the company benefited from accelerating P&C rate momentum and stable new business.
Behind Second-Quarter Headlines
Net written premiums at Property & Casualty Operations improved about 3% year over year to $1.9 billion driven by rate increase and higher new business.
Net investment income increased 6.9% year over year to $324 million driven by limited partnership and common stock investments.
Catastrophe losses of $301 million pretax, including $182 million related to COVID-19, $61 million related to civil unrest and $58 million primarily related to severe weather-related events.
Combined ratio deteriorated 1660 basis points year over year to 112.3%.
Book value as of Jun 30, 2020 was $42.91 per share, down 4.6% from Dec 31, 2019.
Core return on equity was 3.4%, down 650 basis points (bps).
CNA Financial Corporation Price, Consensus and EPS Surprise
Specialty’s net written premiums rose nearly 4% year over year to $742 million, driven by solid rate. Combined ratio deteriorated 1350 bps to 104.2%.
Commercial’s net written premiums increased 4% year over year to $949 million, driven by higher new business and favorable rate. Combined ratio deteriorated 1880 bps to 118.5%.
International’s net written premiums declined 4% year over year to $239 million, attributable to continued impact of the strategic exit from certain Lloyd's business classes, offset by growth in Europe. Combined ratio deteriorated 1780 bps to 115.3%.
Life & Group’s total operating revenues were $332 million, down 0.9% year over year. Core income of $14 million doubled year over year driven by better-than-expected persistency.
Corporate & Other’s core loss of $11 million was flat year over year.
Dividend Update
CNA Financial’s board of directors approved a quarterly dividend of 35 cents to be paid out on Sep 3, 2020 to stockholders of record as of Aug 17.
Zacks Rank
CNA Financial currently carries a Zacks Rank #4 (Sell).
Of the insurance industry players that have reported second-quarter results so far, The Progressive Corporation (PGR - Free Report) , Cincinnati Financial (CINF - Free Report) and RLI Corp. (RLI - Free Report) beat the respective Zacks Consensus Estimate for earnings.
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CNA Financial (CNA) Q2 Earnings In Line, Premiums Rise Y/Y
CNA Financial Corporation (CNA - Free Report) reported second-quarter 2020 core earnings of 36 cents per share, which matched the Zacks Consensus Estimate. The bottom line decreased 66.7% year over year.
The quarterly results suffered substantially from catastrophe losses attributable to COVID-19, civil unrest and weather-related events. Nonetheless, the company benefited from accelerating P&C rate momentum and stable new business.
Behind Second-Quarter Headlines
Net written premiums at Property & Casualty Operations improved about 3% year over year to $1.9 billion driven by rate increase and higher new business.
Net investment income increased 6.9% year over year to $324 million driven by limited partnership and common stock investments.
Catastrophe losses of $301 million pretax, including $182 million related to COVID-19, $61 million related to civil unrest and $58 million primarily related to severe weather-related events.
Combined ratio deteriorated 1660 basis points year over year to 112.3%.
Book value as of Jun 30, 2020 was $42.91 per share, down 4.6% from Dec 31, 2019.
Core return on equity was 3.4%, down 650 basis points (bps).
CNA Financial Corporation Price, Consensus and EPS Surprise
CNA Financial Corporation price-consensus-eps-surprise-chart | CNA Financial Corporation Quote
Segment Results
Specialty’s net written premiums rose nearly 4% year over year to $742 million, driven by solid rate. Combined ratio deteriorated 1350 bps to 104.2%.
Commercial’s net written premiums increased 4% year over year to $949 million, driven by higher new business and favorable rate. Combined ratio deteriorated 1880 bps to 118.5%.
International’s net written premiums declined 4% year over year to $239 million, attributable to continued impact of the strategic exit from certain Lloyd's business classes, offset by growth in Europe. Combined ratio deteriorated 1780 bps to 115.3%.
Life & Group’s total operating revenues were $332 million, down 0.9% year over year. Core income of $14 million doubled year over year driven by better-than-expected persistency.
Corporate & Other’s core loss of $11 million was flat year over year.
Dividend Update
CNA Financial’s board of directors approved a quarterly dividend of 35 cents to be paid out on Sep 3, 2020 to stockholders of record as of Aug 17.
Zacks Rank
CNA Financial currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other P&C Insurers
Of the insurance industry players that have reported second-quarter results so far, The Progressive Corporation (PGR - Free Report) , Cincinnati Financial (CINF - Free Report) and RLI Corp. (RLI - Free Report) beat the respective Zacks Consensus Estimate for earnings.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>