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Here's Why You Should Hold Cincinnati Financial (CINF) Now
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Cincinnati Financial Corporation (CINF - Free Report) has been gaining momentum on the back of a higher level of insured exposures, rate increases, an agent-focused business model, consistent cash flow and effective capital deployment.
Growth Projections
The Zacks Consensus Estimate for Cincinnati Financial’s 2024 earnings per share indicates a year-over-year increase of 5.6% from the consensus estimate of 2023. The consensus estimate for revenues is pegged at $9.77 billion, implying a year-over-year improvement of 9.9% from the consensus mark of 2023.
The consensus estimate for 2025 earnings per share indicates a year-over-year increase of 8.4% from the consensus estimate of 2024. The consensus estimate for 2025 revenues is pinned at $10.58 billion, implying a year-over-year improvement of 8.3% from the consensus mark of 2024.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2024 and 2025 earnings has moved 1.1% and 0.8% north, respectively, in the past 30 days, reflecting analysts’ optimism.
Earnings Surprise History
Cincinnati Financial has a solid earnings surprise history. It beat estimates in each of the last four quarters, the average being 35.78%.
Zacks Rank & Price Performance
Cincinnati Financial currently carries a Zacks Rank #3 (Hold). Year to date, the stock has gained 13.5% compared with the industry’s growth of 14.4%.
Image Source: Zacks Investment Research
Style Score
CINF has a VGM Score of B. The VGM Score helps identify stocks with the most attractive value, the best growth and the most promising momentum.
Business Tailwinds
Prudent pricing, an agent-centric model, a higher level of insured exposures and a disciplined expansion of Cincinnati Re should continue to drive Cincinnati Financial’s premiums. CINF boasts above-average industry premium growth.
The Excess and Surplus line has been performing well since its inception in 2008. New business written premiums, higher renewal written premiums and improved average renewal estimated pricing are likely to boost the performance of this segment. Technology and data are also being used to identify new exposures in emerging businesses.
Increasing interest income from fixed-maturity securities and a decrease in equity portfolio dividends should continue to drive net investment income. An improved rate environment should add to the upside. CINF expects its investment philosophy and initiatives can drive investment income growth and lead to a total return on equity investment portfolio over a five-year period that exceeds the five-year return of the S&P 500 Index. Strong cash flow continued to boost investment income, adding to the benefit of rising bond yields.
The company boasts a track record of 63 straight years of dividend hikes, reflecting operational expertise and the board's positive outlook and confidence in outstanding capital, liquidity and financial flexibility. Its dividend yield of 2.6% is better than the industry average of 0.2%, making the stock an attractive pick for yield-seeking investors. Notably, its free cash flow conversion has remained more than 150% over the last many quarters, reflecting its solid earnings.
NMI Holdings has a solid track record of beating earnings estimates in each of the trailing four quarters, the average being 8.60%. Year to date, NMIH has jumped 12.6%.
The Zacks Consensus Estimate for NMIH’s 2024 and 2025 earnings implies year-over-year growth of 9.1% and 8.3%, respectively, from the consensus estimate of the corresponding years.
Palomar has a solid track record of beating earnings estimates in each of the trailing four quarters, the average being 15.10%. Year to date, PLMR has rallied 52.7%.
The Zacks Consensus Estimate for PLMR’s 2024 and 2025 earnings implies year-over-year growth of 16.8% and 19.1%, respectively, from the consensus estimate of the corresponding years.
RLI Corp. has a solid track record of beating earnings estimates in three of the trailing four quarters and missing in one, the average being 132.39%. Year to date, RLI has gained 10.5%.
The Zacks Consensus Estimate for RLI’s 2024 and 2025 earnings implies year-over-year growth of 16.1% and 3.2%, respectively, from the consensus estimate of the corresponding years.
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Here's Why You Should Hold Cincinnati Financial (CINF) Now
Cincinnati Financial Corporation (CINF - Free Report) has been gaining momentum on the back of a higher level of insured exposures, rate increases, an agent-focused business model, consistent cash flow and effective capital deployment.
Growth Projections
The Zacks Consensus Estimate for Cincinnati Financial’s 2024 earnings per share indicates a year-over-year increase of 5.6% from the consensus estimate of 2023. The consensus estimate for revenues is pegged at $9.77 billion, implying a year-over-year improvement of 9.9% from the consensus mark of 2023.
The consensus estimate for 2025 earnings per share indicates a year-over-year increase of 8.4% from the consensus estimate of 2024. The consensus estimate for 2025 revenues is pinned at $10.58 billion, implying a year-over-year improvement of 8.3% from the consensus mark of 2024.
Northbound Estimate Revision
The Zacks Consensus Estimate for 2024 and 2025 earnings has moved 1.1% and 0.8% north, respectively, in the past 30 days, reflecting analysts’ optimism.
Earnings Surprise History
Cincinnati Financial has a solid earnings surprise history. It beat estimates in each of the last four quarters, the average being 35.78%.
Zacks Rank & Price Performance
Cincinnati Financial currently carries a Zacks Rank #3 (Hold). Year to date, the stock has gained 13.5% compared with the industry’s growth of 14.4%.
Image Source: Zacks Investment Research
Style Score
CINF has a VGM Score of B. The VGM Score helps identify stocks with the most attractive value, the best growth and the most promising momentum.
Business Tailwinds
Prudent pricing, an agent-centric model, a higher level of insured exposures and a disciplined expansion of Cincinnati Re should continue to drive Cincinnati Financial’s premiums. CINF boasts above-average industry premium growth.
The Excess and Surplus line has been performing well since its inception in 2008. New business written premiums, higher renewal written premiums and improved average renewal estimated pricing are likely to boost the performance of this segment. Technology and data are also being used to identify new exposures in emerging businesses.
Increasing interest income from fixed-maturity securities and a decrease in equity portfolio dividends should continue to drive net investment income. An improved rate environment should add to the upside. CINF expects its investment philosophy and initiatives can drive investment income growth and lead to a total return on equity investment portfolio over a five-year period that exceeds the five-year return of the S&P 500 Index. Strong cash flow continued to boost investment income, adding to the benefit of rising bond yields.
The company boasts a track record of 63 straight years of dividend hikes, reflecting operational expertise and the board's positive outlook and confidence in outstanding capital, liquidity and financial flexibility. Its dividend yield of 2.6% is better than the industry average of 0.2%, making the stock an attractive pick for yield-seeking investors. Notably, its free cash flow conversion has remained more than 150% over the last many quarters, reflecting its solid earnings.
Stocks to Consider
Some better-ranked stocks from the property and casualty insurance industry are NMI Holdings Inc (NMIH - Free Report) , Palomar Holdings, Inc. (PLMR - Free Report) and RLI Corp. (RLI - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
NMI Holdings has a solid track record of beating earnings estimates in each of the trailing four quarters, the average being 8.60%. Year to date, NMIH has jumped 12.6%.
The Zacks Consensus Estimate for NMIH’s 2024 and 2025 earnings implies year-over-year growth of 9.1% and 8.3%, respectively, from the consensus estimate of the corresponding years.
Palomar has a solid track record of beating earnings estimates in each of the trailing four quarters, the average being 15.10%. Year to date, PLMR has rallied 52.7%.
The Zacks Consensus Estimate for PLMR’s 2024 and 2025 earnings implies year-over-year growth of 16.8% and 19.1%, respectively, from the consensus estimate of the corresponding years.
RLI Corp. has a solid track record of beating earnings estimates in three of the trailing four quarters and missing in one, the average being 132.39%. Year to date, RLI has gained 10.5%.
The Zacks Consensus Estimate for RLI’s 2024 and 2025 earnings implies year-over-year growth of 16.1% and 3.2%, respectively, from the consensus estimate of the corresponding years.