Cincinnati Financial Intrinsic Value Calculator – Cincinnati Financial Reports Disappointing Q1 Results, Missing Earnings and Revenue Estimates
April 28, 2023
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Cincinnati Financial ($NASDAQ:CINF) Corporation (NASDAQ: CINF) reported its first quarter financial results and investors were left disappointed. In comparison to estimates, the company’s GAAP earnings per share of $1.42 was $0.26 lower than expected, and its revenue of $1.84 billion was $450 million less than anticipated. Cincinnati Financial is an insurance holding company that provides property and casualty insurance, as well as life insurance, annuities and retirement planning services to businesses and individuals. The company operates through four primary subsidiaries: The Cincinnati Life Insurance Company, Cincinnati Specialty Underwriters Insurance Company, The Cincinnati Indemnity Company, and The Cincinnati Casualty Company.
Stock Price
CINCINNATI FINANCIAL reported disappointing first quarter results on Thursday, missing both earnings and revenue estimates. The stock opened at $102.0 and closed at $103.6, up by 1.8% from prior closing price of 101.8, despite the lower reported numbers. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Cincinnati Financial. More…
| Total Revenues | Net Income | Net Margin |
| 6.56k | -486 | -7.4% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Cincinnati Financial. More…
| Operations | Investing | Financing |
| 2.05k | -933 | -994 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Cincinnati Financial. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 29.74k | 19.2k | 67.03 |
Key Ratios Snapshot
Some of the financial key ratios for Cincinnati Financial are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| -6.1% | – | -9.8% |
| FCF Margin | ROE | ROA |
| 31.1% | -4.0% | -1.3% |
Analysis – Cincinnati Financial Intrinsic Value Calculator
At GoodWhale, we have completed a thorough analysis of CINCINNATI FINANCIAL‘s fundamentals. Using our proprietary Valuation Line, our fair value calculation is around $112.6 per share. Currently, the market price of CINCINNATI FINANCIAL stock is $103.6. This means that the stock is currently undervalued by 8.0%. More…
Peers
Cincinnati Financial Corp, Mercury General Corp, United Fire Group Inc, and FedNat Holding Co are all insurance companies. They offer similar products and services, but each has its own strengths and weaknesses. Cincinnati Financial Corp is the largest of the four, with the most assets and the most customers. Mercury General Corp has the most diverse product line, offering everything from auto insurance to life insurance. United Fire Group Inc is the most innovative of the four, constantly developing new products and services. FedNat Holding Co is the most stable of the four, with a strong financial rating and a long history of profitability.
– Mercury General Corp ($NYSE:MCY)
Mercury General Corporation is an insurance holding company that, through its subsidiaries, provides personal automobile insurance in the United States. The company operates through four segments: Personal Auto, Commercial Auto, Other Business, and Investment.
Mercury General’s market cap has declined significantly over the past few years, from over $5 billion in 2015 to just over $1.6 billion as of 2022. The company’s return on equity has also been negative in recent years, reaching -16.66% in 2021.
The company has struggled in recent years due to a combination of factors, including increased competition, higher claims costs, and lower investment returns. Mercury General has taken steps to improve its financial performance, including reducing expenses and increasing its focus on higher-margin business segments. However, it remains to be seen whether these efforts will be enough to turn the company around in the long term.
– United Fire Group Inc ($NASDAQ:UFCS)
United Fire Group, Inc., through its subsidiaries, provides insurance protection in the property and casualty market for individuals, families, and businesses worldwide. The company operates in three segments: Property and Casualty, Reinsurance, and Life. The Property and Casualty segment offers commercial and personal lines of property and casualty insurance products, including automobile, homeowners, workers’ compensation, general liability, commercial multi-peril, and commercial automobile insurance products; and reinsurance products. The Reinsurance segment provides property and casualty reinsurance products. The Life segment offers life insurance and annuity products. United Fire Group, Inc. was founded in 1834 and is headquartered in Cedar Rapids, Iowa.
– FedNat Holding Co ($NASDAQ:FNHC)
Founded in 1934, Federated National Holding Company is a provider of personal and commercial property and casualty insurance products in the United States. The company operates through the following segments: Personal Lines, Commercial Lines, and Specialty Lines. Federated National Holding Company offers its products through a network of independent agents and brokers.
Summary
Cincinnati Financial recently reported earnings and revenue that fell short of estimates. Their reported GAAP EPS of $1.42 was $0.26 lower than expected, while revenue of $1.84B was $450M lower than analysts had anticipated. Despite the miss, investors should still consider Cincinnati Financial as a potential investment given their long history of financial success. Going forward, paying close attention to management’s strategies and performance will be key in determining whether or not the company is a worthwhile investment.
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