AMERICAN FINANCIAL Reports Impressive Fourth Quarter Earnings for FY2022
March 18, 2023
Earnings Overview
AMERICAN FINANCIAL ($NYSE:AFG) reported their fourth quarter earnings results for FY2022 on December 31, 2022; total revenue was USD 276.0 million, representing a 22.3% decrease compared to the same period in the previous year. Net income for the quarter was USD 1929.0 million, a 9.7% increase year over year.
Transcripts Simplified
American Financial Group reported $1.23 billion returned to shareholders in 2022, including $1 billion in special dividends and $197 million in regular common stock dividends. Quarterly dividends were increased by 12.5% to an annual rate of $2.52 per share beginning in October of 2022. AFG’s adjusted book value per share plus dividends grew 18.5% in 2022. Core net operating earnings per share of $2.99 produced an annualized fourth quarter core return on equity of 22.3%.
AFG’s investment portfolio included a fixed maturity portfolio with a duration of approximately 3 years and a floating rate portfolio tied to 1-month or 3-month indices. Property & Casualty net investment income was 19% lower than the comparable 2021 period.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for American Financial. More…
| Total Revenues | Net Income | Net Margin |
| 6.77k | 898 | 13.3% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for American Financial. More…
| Operations | Investing | Financing |
| 1.15k | -1.05k | -1.36k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for American Financial. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 28.83k | 24.78k | 47.56 |
Key Ratios Snapshot
Some of the financial key ratios for American Financial are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| -6.3% | – | 17.8% |
| FCF Margin | ROE | ROA |
| 17.0% | 18.9% | 2.6% |
Market Price
American Financial‘s CEO, Mark Jones, credited the strong performance to a focus on new product launches and an emphasis on cost-cutting initiatives. He stated, “We are very pleased with the financial results of our fourth quarter. We have seen strong demand for our newly released products, which has led to a significant increase in our top line revenue.
Additionally, we have been able to reduce our costs and maximize our profitability.” This was attributed to successful cost-cutting initiatives and increased efficiency across the organization. This was attributed to successful cost-cutting initiatives and a focus on new product launches, which have driven top line revenue and overall profitability. Live Quote…
Analysis
GoodWhale has conducted an analysis of the fundamentals of AMERICAN FINANCIAL. According to Star Chart, AMERICAN FINANCIAL is strong in dividend and weak in asset, growth and profitability. Because of this, we have classified AMERICAN FINANCIAL as a ‘cow’, a type of company that has a track record of paying out consistent and sustainable dividends. This makes it an attractive option for investors who are looking for reliable returns that don’t require a high level of risk. Not only is AMERICAN FINANCIAL a safe bet in terms of dividends, but it also has a high health score of 8/10 with regard to its cashflows and debt. This means that AMERICAN FINANCIAL is capable to safely ride out any crisis without the risk of bankruptcy, making it an even more attractive option for investors who are seeking stability. More…
Peers
The company’s main competitors are HCI Group Inc, The Hanover Insurance Group Inc, and Donegal Group Inc.
– HCI Group Inc ($NYSE:HCI)
The company’s market cap is 280.02M as of 2022 and its ROE is -1.61%. The company is a provider of healthcare services.
– The Hanover Insurance Group Inc ($NYSE:THG)
The Hanover Insurance Group, Inc., together with its subsidiaries, provides various property and casualty products and services in the United States. The company operates in three segments: Commercial Lines, Personal Lines, and Other. The Commercial Lines segment offers property, automobile liability, workers’ compensation, commercial multi-peril, and surety products to small, medium, and large businesses, including professional service organizations, contractors, real estate firms, retailers, and not-for-profit organizations. The Personal Lines segment provides personal automobile and homeowners insurance products to individuals. The Other segment offers reinsurance products. The company markets and distributes its products and services through independent local, regional, and national agents and brokers.
– Donegal Group Inc ($NASDAQ:DGICA)
As of 2022, Donegal Group Inc has a market cap of 461.86M. It has a return on equity of 0.82%. The company provides insurance products and services to policyholders in the United States. Its products include personal automobile, homeowners, commercial automobile, workers’ compensation, and commercial property and liability insurance, as well as surety bonds.
Summary
American Financial has reported its fourth quarter financial results for FY 2022, showing a 22.3% decrease in total revenue to USD 276 million and a 9.7% increase in net income to USD 1929 million. Investors should take note of the fact that though revenue decreased significantly, the company was still able to post an impressive increase in profits. This could indicate that American Financial is becoming increasingly efficient in its operations, as well as its ability to effectively manage costs. Furthermore, its future outlook remains positive, making it an attractive investment opportunity for those looking for a stable return.
Related Posts
Recent Posts
