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CNA Financial Incurs Loss in Q4, Okays Special Dividend

CNA Financial CorporationCNA incurred fourth-quarter 2015 operating loss of 19 cents per share, while the Zacks Consensus Estimate was earnings of 90 cents. In the year-ago quarter, the company had earned 76 cents per share.

CNA Financial Corporation (CNA) Street EPS & Surprise Percent - Last 5 Quarters | FindTheCompany

Including net realized investment losses, net loss came in at 26 cents per share against 73 cents per share earned in the year-ago quarter.

For full-year 2015, net operating income came in at $1.90 per share, down 39% over 2014. Net income, including net realized investment losses, were $1.77 per share, down 31% over 2014.

Behind the Q4 Headlines

Net investment income declined 14% year over year to $314 million due to soft performance at limited partnership investments.

Net written premiums at Property & Casualty Operations increased 1.9% year over year to $1.6 billion. Net operating income decreased 36% year over year to $202 million attributable to less favorable underwriting results and lower net investment income. Combined ratio deteriorated 710 basis points in the quarter.

Book value as of Dec 31, 2015 was $44.66 per share, down 2.7% from Dec 31, 2014.

Segment Results

Specialty net written premiums increased 2.2% year over year to $704 million. While retention was strong, average rate for the policies renewed remained flat year over year. Combined ratio deteriorated 660 basis points to 95%.

Commercial net written premiums increased 2.3% year over year to $700 million driven by new business and retention as well as a positive rate. Combined ratio deteriorated 280 basis points to 99.6%.

International net written premiums decreased 0.5% year over year to $181 million. Though retentions were strong, average rate on policies renewed decreased. Combined ratio deteriorated 2300 basis points to 109.9%.

Life & Group Non-Core operating revenues decreased 7.7% year over year to $299 million. Net operating loss widened to $243 million from the year-ago loss of $34 million.

Corporate & Other Non-Core net operating loss narrowed to $11 million from $75 million loss incurred in the year-ago quarter.

Dividend Update

The board of directors of CNA Financial announced a quarterly dividend of 25 cents per share. Concurrently, the board of directors also approved a special dividend of $2.00 per share. This marks the third straight year of special dividend announcement.

Both dividends will be paid on Mar 9, 2015 to stockholders of record on Feb 22.

Zacks Rank and Performance by Other P&C Insurers

CNA Financial currently carries a Zacks Rank #4 (Sell). The bottom line at The Travelers Companies, Inc. TRV and Progressive Corp PGR outperformed their respective Zacks Consensus Estimate in the fourth quarter. The same at RLI Corp. RLI missed our expectation.

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RLI CORP (RLI): Free Stock Analysis Report

TRAVELERS COS (TRV): Free Stock Analysis Report

PROGRESSIVE COR (PGR): Free Stock Analysis Report

CNA FINL CORP (CNA): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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