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Why Is CNA Financial (CNA) Down 3.6% Since Last Earnings Report?
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A month has gone by since the last earnings report for CNA Financial (CNA - Free Report) . Shares have lost about 3.6% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is CNA Financial due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
CNA Financial Q4 Earnings, Revenues Top, Dividend Up
CNA Financial reported fourth-quarter 2022 core earnings of $1.01 per share, which beat the Zacks Consensus Estimate by 21.7%. The bottom line increased 4.1% year over year.
The insurer’s results reflected solid top-line growth and strong underwriting profitability.
Behind Fourth-Quarter Headlines
Total operating revenues of CNA Financial were $2.7 billion, up 2.2% year over year due to higher premiums. The top line beat the Zacks Consensus Estimate by 3.6%.
Net written premiums of Property & Casualty Operations improved 5% year over year to $2.3 billion, driven by a retention rate of 86% and renewal premium change of 7%.
Net investment income decreased 9% year over year to $503 million. The decrease was due to a decline in income from limited partnership and common stock investments.
Total claims, benefits and expenses decreased 3% to $2.8 billion, primarily due to Insurance claims and policyholders' benefits.
Catastrophe losses were $76 million, wider than losses of $40 million in the year-ago quarter.
The combined ratio deteriorated 170 basis points (bps) year over year to 93.7.
Core return on equity was 6.9%, down 80 bps. Book value excluding AOCI as of Dec 31 was $45.71 per share, down 0.7% from Dec 31, 2021. Statutory surplus decreased 6.6% from 2021 end to $10.6 billion at quarter end.
Segment Results
Specialty’s net written premiums declined 1% year over year to $860 million. The combined ratio improved 110 bps to 88.8.
Commercial’s net written premiums increased 11% year over year to $1 billion. The combined ratio deteriorated 410 bps to 99.
International’s net written premiums increased 2% year over year to $325 million. The combined ratio improved 590 bps to 94.4.
Life & Group’s net earned premiums were $117 million, down 4.1% year over year. The core loss was $16 million against $6 million earned in the year-ago quarter due to lower net investment income.
Corporate & Other’s core loss of $52 million was narrower than a loss of $94 million in the year-earlier quarter.
Full-Year Highlights
Core earnings of $3.84 per share beat the Zacks Consensus Estimate of $3.67. The bottom line decreased 5.4% year over year.
Total operating revenues of CNA Financial were $10.5 billion, up 1.3% year over year due to higher premiums and net investment income. The top line beat the Zacks Consensus Estimate of $10.4 million.
Net earned premiums increased 6% to $8.7 billion. Combined ratio improved 300 basis points to 93.2.
Core return on equity was 8.4%, contracted 70 basis points.
Dividend Update
CNA Financial’s board of directors approved a quarterly dividend of 42 cents per share, an increase of 5%, to be paid out on Mar 9 to shareholders of Feb 21.
In the reported quarter, CNA paid a special dividend of $1.20 per share.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision.
The consensus estimate has shifted 14.71% due to these changes.
VGM Scores
At this time, CNA Financial has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise CNA Financial has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
CNA Financial belongs to the Zacks Insurance - Property and Casualty industry. Another stock from the same industry, Progressive (PGR - Free Report) , has gained 4.4% over the past month. More than a month has passed since the company reported results for the quarter ended December 2022.
Progressive reported revenues of $13.54 billion in the last reported quarter, representing a year-over-year change of +12.2%. EPS of $1.50 for the same period compares with $1.05 a year ago.
For the current quarter, Progressive is expected to post earnings of $1.60 per share, indicating a change of +42.9% from the year-ago quarter. The Zacks Consensus Estimate has changed -8.4% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Progressive. Also, the stock has a VGM Score of D.
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Why Is CNA Financial (CNA) Down 3.6% Since Last Earnings Report?
A month has gone by since the last earnings report for CNA Financial (CNA - Free Report) . Shares have lost about 3.6% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is CNA Financial due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
CNA Financial Q4 Earnings, Revenues Top, Dividend Up
CNA Financial reported fourth-quarter 2022 core earnings of $1.01 per share, which beat the Zacks Consensus Estimate by 21.7%. The bottom line increased 4.1% year over year.
The insurer’s results reflected solid top-line growth and strong underwriting profitability.
Behind Fourth-Quarter Headlines
Total operating revenues of CNA Financial were $2.7 billion, up 2.2% year over year due to higher premiums. The top line beat the Zacks Consensus Estimate by 3.6%.
Net written premiums of Property & Casualty Operations improved 5% year over year to $2.3 billion, driven by a retention rate of 86% and renewal premium change of 7%.
Net investment income decreased 9% year over year to $503 million. The decrease was due to a decline in income from limited partnership and common stock investments.
Total claims, benefits and expenses decreased 3% to $2.8 billion, primarily due to Insurance claims and policyholders' benefits.
Catastrophe losses were $76 million, wider than losses of $40 million in the year-ago quarter.
The combined ratio deteriorated 170 basis points (bps) year over year to 93.7.
Core return on equity was 6.9%, down 80 bps. Book value excluding AOCI as of Dec 31 was $45.71 per share, down 0.7% from Dec 31, 2021. Statutory surplus decreased 6.6% from 2021 end to $10.6 billion at quarter end.
Segment Results
Specialty’s net written premiums declined 1% year over year to $860 million. The combined ratio improved 110 bps to 88.8.
Commercial’s net written premiums increased 11% year over year to $1 billion. The combined ratio deteriorated 410 bps to 99.
International’s net written premiums increased 2% year over year to $325 million. The combined ratio improved 590 bps to 94.4.
Life & Group’s net earned premiums were $117 million, down 4.1% year over year. The core loss was $16 million against $6 million earned in the year-ago quarter due to lower net investment income.
Corporate & Other’s core loss of $52 million was narrower than a loss of $94 million in the year-earlier quarter.
Full-Year Highlights
Core earnings of $3.84 per share beat the Zacks Consensus Estimate of $3.67. The bottom line decreased 5.4% year over year.
Total operating revenues of CNA Financial were $10.5 billion, up 1.3% year over year due to higher premiums and net investment income. The top line beat the Zacks Consensus Estimate of $10.4 million.
Net earned premiums increased 6% to $8.7 billion. Combined ratio improved 300 basis points to 93.2.
Core return on equity was 8.4%, contracted 70 basis points.
Dividend Update
CNA Financial’s board of directors approved a quarterly dividend of 42 cents per share, an increase of 5%, to be paid out on Mar 9 to shareholders of Feb 21.
In the reported quarter, CNA paid a special dividend of $1.20 per share.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision.
The consensus estimate has shifted 14.71% due to these changes.
VGM Scores
At this time, CNA Financial has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise CNA Financial has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
CNA Financial belongs to the Zacks Insurance - Property and Casualty industry. Another stock from the same industry, Progressive (PGR - Free Report) , has gained 4.4% over the past month. More than a month has passed since the company reported results for the quarter ended December 2022.
Progressive reported revenues of $13.54 billion in the last reported quarter, representing a year-over-year change of +12.2%. EPS of $1.50 for the same period compares with $1.05 a year ago.
For the current quarter, Progressive is expected to post earnings of $1.60 per share, indicating a change of +42.9% from the year-ago quarter. The Zacks Consensus Estimate has changed -8.4% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Progressive. Also, the stock has a VGM Score of D.