A month has gone by since the last earnings report for Cincinnati Financial (CINF). Shares have added about 11% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Cincinnati Financial due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for Cincinnati Financial Corporation before we dive into how investors and analysts have reacted as of late.
Cincinnati Financial Q3 Earnings and Revenues Top, Premiums Rise Y/Y
Cincinnati Financial Corporation reported third-quarter 2025 operating income of $2.85 per share, which surpassed the Zacks Consensus Estimate by 41.8%. The bottom line increased 100.7% year over year. The quarterly results of CINF were aided by premium growth initiatives, price increases and higher interest income from fixed-maturity securities.
Operational Update
Total operating revenues in the quarter under review were $2.9 billion, which improved 12.1% year over year. This improvement was driven by higher earned premiums, investment income and other revenues. The top line beat the consensus mark by 0.8%. Net written premiums climbed 9% year over year to $2.5 billion, driven by premium growth initiatives, price increases and a higher level of insured exposures, as well as contributions to growth from Cincinnati Re and Cincinnati Global.
Investment income, net of expenses, increased 14% year over year to $295 million and was higher than our estimate of $291.6 million. It was due to an increase in interest income from fixed-maturity securities and an increase in equity portfolio dividends. The Zacks Consensus Estimate was pegged at $300.3 million. Total benefits and expenses of Cincinnati Financial increased 14.5% year over year to $2.3 billion, primarily due to higher underwriting, acquisition and insurance expenses. Our estimate was $2.5 billion.
In its property & casualty (P&C) insurance business, CINF witnessed an underwriting income of $293 million, which increased nearly fivefold from the year-ago period. The combined ratio, a measure of underwriting profitability, improved 920 basis points (bps) year over year to 88.2. Our estimate was pinned at 98.
Quarterly Segment Update
Commercial Lines Insurance: Total revenues of $1.2 billion increased 8% year over year, driven by an 8% rise in premiums earned. Our estimate was $1.3 billion and the Zacks Consensus Estimate was $1.2 billion. Underwriting income was $111 million, which jumped nearly 37% year over year. The combined ratio improved 190 bps year over year to 91.9. Our estimate was pegged at 92.7.
Personal Lines Insurance: Total revenues of $839 million increased 23% year over year on account of a 24% rise in premiums earned. Our estimate was $900.9 million, while the Zacks Consensus Estimate was pegged at $852.6 million. The company reported an underwriting profit of $99 million against an underwriting loss of $22 million incurred in the year-earlier period. The combined ratio improved 2210 bps year over year to 88.2.
Excess and Surplus Lines Insurance: Total revenues of $157 million grew 11% year over year, aided by 11% higher earned premiums. Our estimate was $168.7 million, while the Zacks Consensus Estimate was pegged at $178.8 million. Underwriting profit jumped 138% year over year to $19 million. Our estimate was pinned at $14.2 million. The combined ratio improved 550 bps year over year to 98.8. Our estimate was 92.1.
Life Insurance: Total revenues were $135 million, up 5% year over year. The Zacks Consensus Estimate was pegged at $95.1 million. Our estimate was $83.5 million. Total benefits and expenses decreased 4% year over year to $99 million due to lower contract holders’ benefits incurred and lower underwriting expenses incurred.
Financial Update
As of Sept. 30, 2025, Cincinnati Financial had total assets worth $40.6 billion, up 11.1% from the level at the end of 2024. Total debt was $815 million as of Sept. 30, 2025, which remained unchanged from the 2024-end level.
The company’s debt-to-capital ratio was 5% as of Sept. 30, 2025, which improved 50 bps from the end of 2024. As of Sept. 30, 2025, CINF’s book value per share was $98.76, up 12% from 2024-end.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, Cincinnati Financial has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Cincinnati Financial has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Cincinnati Financial is part of the Zacks Insurance - Property and Casualty industry. Over the past month, Progressive (PGR), a stock from the same industry, has gained 6.8%. The company reported its results for the quarter ended September 2025 more than a month ago.
Progressive reported revenues of $22.22 billion in the last reported quarter, representing a year-over-year change of +14.3%. EPS of $4.05 for the same period compares with $3.58 a year ago.
Progressive is expected to post earnings of $4.37 per share for the current quarter, representing a year-over-year change of +7.1%. Over the last 30 days, the Zacks Consensus Estimate has changed -1.3%.
Progressive has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
