On Sep 25, Zacks Investment Research upgraded
Cincinnati Financial Corp
) to a Zacks Rank #1 (Strong Buy).
BERKSHIRE HTH-A (BRK.A): Free Stock Analysis
BERKSHIRE HTH-B (BRK.B): Free Stock Analysis
CINCINNATI FINL (CINF): Free Stock Analysis
CNA FINL CORP (CNA): Free Stock Analysis
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Why the Upgrade?
Cincinnati Financial has witnessed rising earnings estimates on
the back of strong second-quarter 2013 results. Moreover, this
property and casualty insurer delivered positive earnings
surprises in the last 4 quarters with an average beat of 72%.
Cincinnati Financial reported second-quarter results on Jul 26.
Non-GAAP earnings per share came in at 61 cents, surpassing the
Zacks Consensus Estimate of 32 cents by 90.6% and year-ago
earnings by more than three fold.
Earnings were primarily aided by increased underwriting profits
from each of the three property casualty segments.
Revenue for Cincinnati Financial improved 8% year over year
driven by higher premiums earned (up 9% year over year). In
addition, total benefits and expenses for Cincinnati Financial in
the quarter decreased 3.5%.
At quarter-end, debt to capital ratio improved 50 basis points to
13.6% from 14.1% at year-end 2012. As of Jun 30, 2013, book value
per share of Cincinnati Financial was $34.83, up 4% from Dec 31,
In August, the board also approved a 3.1% hike in its quarterly
dividend to 42 cents per share. Its dividend yield of 3.6% is
ahead of the industry yield of 2.5%
The Zacks Consensus Estimate for 2013 increased 15.3% to $2.56
per share. All the estimates were revised higher over the last 60
days. For fiscal 2014 as well, the Zacks Consensus Estimate moved
to $2.43 by 4.3%, owing to the upward revision of all the
Other Stocks to Consider
Other better-placed property and casualty insurers
Berkshire Hathaway Inc
CNA Financial Corp.
), that carry a Zacks Rank #1 (Strong Buy), are also worth