Cincinnati Financial Stock Fair Value Calculation – Advisor Group Holdings Decreases Holdings in Cincinnati Financial Co. by 9.4% in Q4 2021
June 20, 2023
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Advisor Group Holdings, a financial services company, recently announced that it had decreased its holdings in Cincinnati Financial ($NASDAQ:CINF) Co. by 9.4% during the fourth quarter of 2021. Cincinnati Financial Co. is a diversified insurance company based out of Fairfield, Ohio. This recent decrease in its holdings by Advisor Group Holdings comes as a surprise to many investors, as Cincinnati Financial Co.’s stock price has been steadily increasing over the past year. It remains to be seen whether Advisor Group will continue to reduce its holdings or if it will look to increase its stake in the future.
Analysis – Cincinnati Financial Stock Fair Value Calculation
GoodWhale has analyzed CINCINNATI FINANCIAL‘s financials and used our proprietary Valuation Line to calculate the company’s intrinsic value. According to our research, we estimate CINCINNATI FINANCIAL share is worth approximately $102.7. Currently, CINCINNATI FINANCIAL stock is trading at $96.5, representing a 6.0% undervaluation of its intrinsic value. This means that investors may be presented with an attractive buying opportunity at the current market price. More…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Cincinnati Financial. More…
| Total Revenues | Net Income | Net Margin |
| 7.58k | 5 | 0.1% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Cincinnati Financial. More…
| Operations | Investing | Financing |
| 2.1k | -1.13k | -1k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Cincinnati Financial. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 30.47k | 19.73k | 68.33 |
Key Ratios Snapshot
Some of the financial key ratios for Cincinnati Financial are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 10.2% | – | -0.3% |
| FCF Margin | ROE | ROA |
| 27.6% | -0.1% | -0.0% |
Peers
Cincinnati Financial Corp, Mercury General Corp, United Fire Group Inc, and FedNat Holding Co are all insurance companies. They offer similar products and services, but each has its own strengths and weaknesses. Cincinnati Financial Corp is the largest of the four, with the most assets and the most customers. Mercury General Corp has the most diverse product line, offering everything from auto insurance to life insurance. United Fire Group Inc is the most innovative of the four, constantly developing new products and services. FedNat Holding Co is the most stable of the four, with a strong financial rating and a long history of profitability.
– Mercury General Corp ($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
Recent investing analysis of Cincinnati Financial Co has revealed that Advisor Group Holdings Inc. decreased its holdings by 9.4% in the fourth quarter of 2021. This move suggests a shift in strategy from the investment firm, possibly due to a perceived bearish outlook on the company’s performance or a lack of confidence in its financials. It is important for prospective investors to pay attention to these movements and to conduct their own research before investing. Financial advisors may also be able to provide insights on the firm’s future prospects.
