We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
American Financial Outperforms Industry in a Year: Time to Buy?
Read MoreHide Full Article
Key Takeaways
AFG expects growth from new business, increased exposure and crop premiums.
The insurer has achieved renewal rate increases for 35 consecutive quarters.
AFG has raised dividends for 20 straight years, backed by strong underwriting results and capital management.
American Financial Group, Inc. (AFG - Free Report) shares have gained 5.5% in the past year against the industry's decline of 1%.
AFG has outperformed its peers, Arch Capital Group Ltd. (ACGL - Free Report) , W.R. Berkley Corporation. (WRB - Free Report) and Kinsale Capital Group, Inc. (KNSL - Free Report) . While ACGL has gained 0.1%, WRB and KNSL have lost 9.1% and 35.4%, respectively, in the same time frame.
Image Source: Zacks Investment Research
American Financial has been trading above its 50-day simple moving average (SMA), signaling a short-term bullish trend. Its share price, as of June 18, 2026, was $132.90, down 12.9% from its 52-week high of $150.02. The 50-day SMA is a key indicator for traders and analysts to identify support and resistance levels. It is considered particularly important as this is the first marker of an uptrend or downtrend.
Image Source: Zacks Investment Research
With a market capitalization of $11.04 billion, the average volume of shares traded in the last three months was 0.5 million. AFG has a solid earnings surprise history. It beat estimates in three of the last four quarters and missed in one, the average being 7.25%.
AFG’s Growth Projection Encourages
The Zacks Consensus Estimate for American Financial’s 2026 earnings per share indicates a year-over-year increase of 10.5%. The consensus estimate for revenues is pegged at $8.02 billion, implying a year-over-year improvement of 0.4%.
The consensus estimate for 2027 earnings per share and revenues indicates an increase of 5.2% and 7.9%, respectively, from the corresponding 2026 estimates.
Average Target Price for AFG Suggests Upside
Based on short-term price targets offered by six analysts, the Zacks average price target is $142.83 per share. The average suggests a potential 7.47% upside from the last closing price.
Image Source: Zacks Investment Research
AFG’s Favorable Return on Capital
American Financial’s return on equity has also been improving over the last few quarters, reflecting its efficiency in utilizing shareholders’ funds. The trailing 12 months ROE was 19.5%, which compared favorably with the industry average of 7.4%.
Factors Favoring AFG
New business opportunities, increased exposure and a good renewal rate environment, coupled with additional crop premiums from the Crop Risk Services acquisition, position AFG well for growth.
American Financial, a niche player in the P&C market, is likely to benefit from strategic acquisitions and improved pricing. Improved industry fundamentals drive overall growth.
American Financial witnessed average renewal pricing across the entire P&C Group. It intends to maintain satisfactory rates in P&C renewal pricing going forward. AFG has reported overall renewal rate increases for 35 consecutive quarters, and it is expected to achieve overall renewal rate increases in excess of prospective loss ratio trends to meet or exceed targeted returns. The property and casualty insurer expects to achieve overall renewal rate increases in excess of prospective loss ratio trends to meet or exceed targeted returns.
Its combined ratio has been better than the industry average for more than two decades. Specialty niche focus, product line diversification and underwriting discipline should help AFG outperform the industry’s underwriting results.
Wealth Distribution
American Financial has increased its dividend for 20 straight years, apart from paying special dividends occasionally. This reflects its financial stability, which stems from robust operating profitability in the P&C segment, stellar investment performance and effective capital management.
Notably, the 10-year compound annual growth rate for the company's regular annual dividends is pinned at an impressive 12.4%. This track record underscores its prudent financial management and stability. The dividend yield is 2.6%, better than the industry average of 0.2%.
End Notes
American Financial’s prudent capital deployment, increased exposures, good renewal rate environment, and improved combined ratio make it an attractive stock. It intends to maintain satisfactory rates in P&C renewal pricing in the future.
American Financial also has a VGM Score of A. Stocks with a favorable VGM Score are those with the most attractive value, best growth, and most promising momentum compared with peers.
American Financial should benefit from strategic acquisitions, new business opportunities, and stronger underwriting profit. Coupled with the impressive dividend history, solid growth projections, and higher return on capital, the time appears right for potential investors to bet on this Zacks Rank #2 (Buy) insurer. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
View the Zacks #1 Rank List
Image: Bigstock
American Financial Outperforms Industry in a Year: Time to Buy?
Key Takeaways
American Financial Group, Inc. (AFG - Free Report) shares have gained 5.5% in the past year against the industry's decline of 1%.
AFG has outperformed its peers, Arch Capital Group Ltd. (ACGL - Free Report) , W.R. Berkley Corporation. (WRB - Free Report) and Kinsale Capital Group, Inc. (KNSL - Free Report) . While ACGL has gained 0.1%, WRB and KNSL have lost 9.1% and 35.4%, respectively, in the same time frame.
Image Source: Zacks Investment Research
American Financial has been trading above its 50-day simple moving average (SMA), signaling a short-term bullish trend. Its share price, as of June 18, 2026, was $132.90, down 12.9% from its 52-week high of $150.02. The 50-day SMA is a key indicator for traders and analysts to identify support and resistance levels. It is considered particularly important as this is the first marker of an uptrend or downtrend.
Image Source: Zacks Investment Research
With a market capitalization of $11.04 billion, the average volume of shares traded in the last three months was 0.5 million. AFG has a solid earnings surprise history. It beat estimates in three of the last four quarters and missed in one, the average being 7.25%.
AFG’s Growth Projection Encourages
The Zacks Consensus Estimate for American Financial’s 2026 earnings per share indicates a year-over-year increase of 10.5%. The consensus estimate for revenues is pegged at $8.02 billion, implying a year-over-year improvement of 0.4%.
The consensus estimate for 2027 earnings per share and revenues indicates an increase of 5.2% and 7.9%, respectively, from the corresponding 2026 estimates.
Average Target Price for AFG Suggests Upside
Based on short-term price targets offered by six analysts, the Zacks average price target is $142.83 per share. The average suggests a potential 7.47% upside from the last closing price.
Image Source: Zacks Investment Research
AFG’s Favorable Return on Capital
American Financial’s return on equity has also been improving over the last few quarters, reflecting its efficiency in utilizing shareholders’ funds. The trailing 12 months ROE was 19.5%, which compared favorably with the industry average of 7.4%.
Factors Favoring AFG
New business opportunities, increased exposure and a good renewal rate environment, coupled with additional crop premiums from the Crop Risk Services acquisition, position AFG well for growth.
American Financial, a niche player in the P&C market, is likely to benefit from strategic acquisitions and improved pricing. Improved industry fundamentals drive overall growth.
American Financial witnessed average renewal pricing across the entire P&C Group. It intends to maintain satisfactory rates in P&C renewal pricing going forward. AFG has reported overall renewal rate increases for 35 consecutive quarters, and it is expected to achieve overall renewal rate increases in excess of prospective loss ratio trends to meet or exceed targeted returns. The property and casualty insurer expects to achieve overall renewal rate increases in excess of prospective loss ratio trends to meet or exceed targeted returns.
Its combined ratio has been better than the industry average for more than two decades. Specialty niche focus, product line diversification and underwriting discipline should help AFG outperform the industry’s underwriting results.
Wealth Distribution
American Financial has increased its dividend for 20 straight years, apart from paying special dividends occasionally. This reflects its financial stability, which stems from robust operating profitability in the P&C segment, stellar investment performance and effective capital management.
Notably, the 10-year compound annual growth rate for the company's regular annual dividends is pinned at an impressive 12.4%. This track record underscores its prudent financial management and stability. The dividend yield is 2.6%, better than the industry average of 0.2%.
End Notes
American Financial’s prudent capital deployment, increased exposures, good renewal rate environment, and improved combined ratio make it an attractive stock. It intends to maintain satisfactory rates in P&C renewal pricing in the future.
American Financial also has a VGM Score of A. Stocks with a favorable VGM Score are those with the most attractive value, best growth, and most promising momentum compared with peers.
American Financial should benefit from strategic acquisitions, new business opportunities, and stronger underwriting profit. Coupled with the impressive dividend history, solid growth projections, and higher return on capital, the time appears right for potential investors to bet on this Zacks Rank #2 (Buy) insurer. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.