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CNA Financial (CNA) Gains 13.4% in 6 Months: More Room to Run?
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Shares of CNA Financial Corporation (CNA - Free Report) have gained 13.4% in the past six months compared with the industry's growth of 7.6%. The Finance sector and the Zacks S&P 500 index have risen 6.1% and 6.3% in the said time frame, respectively. With a market capitalization of $12 billion, the average volume of shares traded in the last three months was 0.2 million.
Image Source: Zacks Investment Research
The rally was largely driven by new businesses, higher income from limited partnerships, improved net earned premium and sufficient liquidity.
This Zacks Rank #1 (Strong Buy) insurer has a decent earnings surprise history. It surpassed earnings estimates in three of the last four quarters and missed in one, the average being 9.24%.
CNA Financial has a favorable VGM Score of B. The VGM Score helps identify stocks with the most attractive value, the best growth and the most promising momentum.
Back-tested results show that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best opportunities in the value investing space.
Will the Bull Run Continue?
The Zacks Consensus Estimate for CNA Financial’s 2024 earnings has moved up nearly 0.9% in the past seven days, indicating investors’ optimism.
The Zacks Consensus Estimate for CNA’s 2024 earnings is pegged at $5.13 per share, indicating a 15.8% increase from the year-ago reported figure on 2.9% higher revenues of $11.97 billion.
The company’s return on equity (ROE) is 13.8%, which is better than the industry average of 7.2%. ROE reflects the insurer’s efficiency in using shareholders’ funds.
CNA Financial remains well-poised to gain from a rise in new businesses, strong rate, lower net catastrophe losses, improved non-catastrophe current accident year underwriting results and higher net earned premium, which contribute to premium growth across its Specialty, Commercial and International segments.
Net investment income should gain from fixed-income securities and other investments, as well as a rise in income from limited partnership and common stock investments. Fixed income continues to benefit from favorable reinvestment yields and strong operating cash flows. CNA Financial’s fixed-income investment strategy with the highest allocations to diversified investment grade corporates, as well as highly rated municipal securities, should support investment results.
CNA has been able to maintain the underlying combined ratio below 95 for 13 straight quarters. Through targeted portfolio management strategies, the company made significant progress in successfully repositioning the portfolio underwritten via Lloyd’s syndicate in its effort to improve the overall underwriting results of its international operation.
The company has a solid balance sheet, with capital remaining above the target levels required for all ratings. Cash flow from P&C underwriting activities and fixed-income investments remained very strong, reflecting continued excellent underwriting and fixed-income results.
A robust balance sheet and cash flows enable CNA Financial to engage in shareholder-friendly moves like dividend hikes. On the back of a disciplined execution, denoted by strong underwriting results and confidence in future earnings performances, the company has hiked its dividend over the past couple of years.
CNA shares are trading at a price-to-book value multiple of 1.4X, which is lower than the industry average of 1.51X. It also has an impressive Value Score of A. This style score helps find the most attractive value stocks.
Other Stocks to Consider
Some other top-ranked stocks from the property and casualty insurance industry are Cincinnati Financial Corporation (CINF - Free Report) , American Financial Group, Inc. (AFG - Free Report) and The Travelers Companies, Inc. (TRV - Free Report) . While Cincinnati Financial sports a Zacks Rank #1, American Financial and The Travelers carry a Zacks Rank #2 each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Cincinnati Financial surpassed earnings estimates in three of the last four quarters and missed in one, the average being 38.33%. Over the past six months, CINF has gained 9.9%.
The Zacks Consensus Estimate for CINF’s 2024 earnings per share is pegged at $6.06, indicating a year-over-year increase of 8.19%.
The Zacks Consensus Estimate for American Financial’s 2024 earnings per share is pegged at $11.51, indicating a year-over-year increase of 9.3%. Over the past six months, AFG has lost 1.6%.
The Zacks Consensus Estimate for AFG’s 2024 revenues is pegged at $8.04 billion, indicating a year-over-year increase of 10.2%.
The Zacks Consensus Estimate for The Travelers’s 2024 earnings per share is pegged at $19.88, indicating a year-over-year increase of 15.1%. Over the past six months, TRV has surged 22.6%.
The Zacks Consensus Estimate for TRV’s 2024 revenues is pegged at $50.25 billion, indicating a year-over-year increase of 8.6%.
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CNA Financial (CNA) Gains 13.4% in 6 Months: More Room to Run?
Shares of CNA Financial Corporation (CNA - Free Report) have gained 13.4% in the past six months compared with the industry's growth of 7.6%. The Finance sector and the Zacks S&P 500 index have risen 6.1% and 6.3% in the said time frame, respectively. With a market capitalization of $12 billion, the average volume of shares traded in the last three months was 0.2 million.
Image Source: Zacks Investment Research
The rally was largely driven by new businesses, higher income from limited partnerships, improved net earned premium and sufficient liquidity.
This Zacks Rank #1 (Strong Buy) insurer has a decent earnings surprise history. It surpassed earnings estimates in three of the last four quarters and missed in one, the average being 9.24%.
CNA Financial has a favorable VGM Score of B. The VGM Score helps identify stocks with the most attractive value, the best growth and the most promising momentum.
Back-tested results show that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best opportunities in the value investing space.
Will the Bull Run Continue?
The Zacks Consensus Estimate for CNA Financial’s 2024 earnings has moved up nearly 0.9% in the past seven days, indicating investors’ optimism.
The Zacks Consensus Estimate for CNA’s 2024 earnings is pegged at $5.13 per share, indicating a 15.8% increase from the year-ago reported figure on 2.9% higher revenues of $11.97 billion.
The company’s return on equity (ROE) is 13.8%, which is better than the industry average of 7.2%. ROE reflects the insurer’s efficiency in using shareholders’ funds.
CNA Financial remains well-poised to gain from a rise in new businesses, strong rate, lower net catastrophe losses, improved non-catastrophe current accident year underwriting results and higher net earned premium, which contribute to premium growth across its Specialty, Commercial and International segments.
Net investment income should gain from fixed-income securities and other investments, as well as a rise in income from limited partnership and common stock investments. Fixed income continues to benefit from favorable reinvestment yields and strong operating cash flows. CNA Financial’s fixed-income investment strategy with the highest allocations to diversified investment grade corporates, as well as highly rated municipal securities, should support investment results.
CNA has been able to maintain the underlying combined ratio below 95 for 13 straight quarters. Through targeted portfolio management strategies, the company made significant progress in successfully repositioning the portfolio underwritten via Lloyd’s syndicate in its effort to improve the overall underwriting results of its international operation.
The company has a solid balance sheet, with capital remaining above the target levels required for all ratings. Cash flow from P&C underwriting activities and fixed-income investments remained very strong, reflecting continued excellent underwriting and fixed-income results.
A robust balance sheet and cash flows enable CNA Financial to engage in shareholder-friendly moves like dividend hikes. On the back of a disciplined execution, denoted by strong underwriting results and confidence in future earnings performances, the company has hiked its dividend over the past couple of years.
CNA shares are trading at a price-to-book value multiple of 1.4X, which is lower than the industry average of 1.51X. It also has an impressive Value Score of A. This style score helps find the most attractive value stocks.
Other Stocks to Consider
Some other top-ranked stocks from the property and casualty insurance industry are Cincinnati Financial Corporation (CINF - Free Report) , American Financial Group, Inc. (AFG - Free Report) and The Travelers Companies, Inc. (TRV - Free Report) . While Cincinnati Financial sports a Zacks Rank #1, American Financial and The Travelers carry a Zacks Rank #2 each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Cincinnati Financial surpassed earnings estimates in three of the last four quarters and missed in one, the average being 38.33%. Over the past six months, CINF has gained 9.9%.
The Zacks Consensus Estimate for CINF’s 2024 earnings per share is pegged at $6.06, indicating a year-over-year increase of 8.19%.
The Zacks Consensus Estimate for American Financial’s 2024 earnings per share is pegged at $11.51, indicating a year-over-year increase of 9.3%. Over the past six months, AFG has lost 1.6%.
The Zacks Consensus Estimate for AFG’s 2024 revenues is pegged at $8.04 billion, indicating a year-over-year increase of 10.2%.
The Zacks Consensus Estimate for The Travelers’s 2024 earnings per share is pegged at $19.88, indicating a year-over-year increase of 15.1%. Over the past six months, TRV has surged 22.6%.
The Zacks Consensus Estimate for TRV’s 2024 revenues is pegged at $50.25 billion, indicating a year-over-year increase of 8.6%.