NasdaqGS:CINF

Stock Analysis Report

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Executive Summary

Cincinnati Financial Corporation, together with its subsidiary, provides property casualty insurance products in the United States. More Details


Snowflake Analysis

Excellent balance sheet established dividend payer.


Similar Companies

Share Price & News

How has Cincinnati Financial's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CINF has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

6.9%

CINF

0.5%

US Insurance

-1.4%

US Market


1 Year Return

-26.9%

CINF

-11.5%

US Insurance

17.8%

US Market

Return vs Industry: CINF underperformed the US Insurance industry which returned -12.8% over the past year.

Return vs Market: CINF underperformed the US Market which returned 18.5% over the past year.


Shareholder returns

CINFIndustryMarket
7 Day6.9%0.5%-1.4%
30 Day11.1%4.5%4.7%
90 Day1.3%0.2%8.2%
1 Year-24.6%-26.9%-9.1%-11.5%20.5%17.8%
3 Year21.2%10.9%0.7%-6.5%42.2%32.7%
5 Year60.3%37.8%36.4%19.2%83.4%62.7%

Price Volatility Vs. Market

How volatile is Cincinnati Financial's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Cincinnati Financial undervalued compared to its fair value and its price relative to the market?

24.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CINF ($84.29) is trading below our estimate of fair value ($111.62)

Significantly Below Fair Value: CINF is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: CINF is poor value based on its PE Ratio (24.6x) compared to the US Insurance industry average (14.1x).

PE vs Market: CINF is poor value based on its PE Ratio (24.6x) compared to the US market (19x).


Price to Earnings Growth Ratio

PEG Ratio: CINF is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: CINF is overvalued based on its PB Ratio (1.5x) compared to the US Insurance industry average (0.9x).


Next Steps

Future Growth

How is Cincinnati Financial forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

61.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CINF's forecast earnings growth (61.3% per year) is above the savings rate (2.2%).

Earnings vs Market: CINF's earnings (61.3% per year) are forecast to grow faster than the US market (22.2% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: CINF's revenue (8.3% per year) is forecast to grow slower than the US market (10.1% per year).

High Growth Revenue: CINF's revenue (8.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CINF's Return on Equity is forecast to be low in 3 years time (6.8%).


Next Steps

Past Performance

How has Cincinnati Financial performed over the past 5 years?

9.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CINF has high quality earnings.

Growing Profit Margin: CINF's current net profit margins (8.6%) are lower than last year (18.2%).


Past Earnings Growth Analysis

Earnings Trend: CINF's earnings have grown by 9.2% per year over the past 5 years.

Accelerating Growth: CINF's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: CINF had negative earnings growth (-54.4%) over the past year, making it difficult to compare to the Insurance industry average (-3.3%).


Return on Equity

High ROE: CINF's Return on Equity (6%) is considered low.


Next Steps

Financial Health

How is Cincinnati Financial's financial position?


Financial Position Analysis

Short Term Liabilities: CINF's short term assets ($3.7B) exceed its short term liabilities ($3.2B).

Long Term Liabilities: CINF's short term assets ($3.7B) do not cover its long term liabilities ($13.0B).


Debt to Equity History and Analysis

Debt Level: CINF's debt to equity ratio (9.6%) is considered satisfactory.

Reducing Debt: CINF's debt to equity ratio has reduced from 12.9% to 9.6% over the past 5 years.

Debt Coverage: CINF's debt is well covered by operating cash flow (151.1%).

Interest Coverage: CINF's interest payments on its debt are well covered by EBIT (12.9x coverage).


Balance Sheet


Next Steps

Dividend

What is Cincinnati Financial current dividend yield, its reliability and sustainability?

2.85%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: CINF's dividend (2.85%) is higher than the bottom 25% of dividend payers in the US market (1.64%).

High Dividend: CINF's dividend (2.85%) is low compared to the top 25% of dividend payers in the US market (4.68%).


Stability and Growth of Payments

Stable Dividend: CINF's dividends per share have been stable in the past 10 years.

Growing Dividend: CINF's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (67.6%), CINF's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CINF's dividends in 3 years are forecast to be covered by earnings (63.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

9.4yrs

Average management tenure


CEO

Steve Johnston (60 yo)

9.42yrs

Tenure

US$5,528,654

Compensation

Mr. Steven Justus Johnston, also known as Steve, FCAS, MAAA, CFA, CERA, is Chief Executive Officer and Chairman at CFC Investment Company and has been its President since August 2020. Mr. Johnston has been ...


CEO Compensation Analysis

Compensation vs Market: Steve's total compensation ($USD5.53M) is below average for companies of similar size in the US market ($USD11.20M).

Compensation vs Earnings: Steve's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Steven Johnston
Chairman9.42yrsUS$5.53m0.16%
$ 21.4m
Michael Sewell
CFO, Principal Accounting Officer9.42yrsUS$3.23m0.054%
$ 7.3m
Martin Hollenbeck
Chief Investment Officer11.75yrsUS$2.68m0.045%
$ 6.0m
Stephen Spray
Senior VP & Chief Insurance Officer of the Cincinnati Insurance Company8.75yrsUS$2.48m0.019%
$ 2.5m
Martin Mullen
Chief Claims Officer & Senior VP of the Cincinnati Insurance Company12.75yrsUS$3.27m0.061%
$ 8.3m
Dennis McDaniel
VP & Investor Relations Officer11.75yrsno datano data
Lisa Love
Senior VP9.42yrsno data0.023%
$ 3.1m
Betsy Ertel
Vice President of Corporate Communicationsno datano datano data
Angela Delaney
Senior Vice President of Sales & Marketingno datano data0.0034%
$ 465.1k
Gregory Ziegler
Human Resources Directorno datano datano data
Teresa Cracas
Chief Risk Officer & Senior VP of the Cincinnati Insurance Co.9.42yrsno data0.019%
$ 2.6m
Donald Doyle
Senior Vice President of the Cincinnati Insurance Company12.75yrsno data0.020%
$ 2.7m

9.4yrs

Average Tenure

60yo

Average Age

Experienced Management: CINF's management team is seasoned and experienced (9.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Steven Johnston
Chairman9.42yrsUS$5.53m0.16%
$ 21.4m
Gretchen Price
Independent Director18.75yrsUS$211.25k0.018%
$ 2.5m
William Bahl
Lead Independent Directorno dataUS$266.30k0.14%
$ 18.9m
Kenneth Lichtendahl
Independent Director32.5yrsUS$206.00k0.024%
$ 3.2m
Thomas Schiff
Director45.5yrsUS$206.14k1.14%
$ 154.6m
Larry Webb
Director41.5yrsUS$220.28k0.31%
$ 42.4m
John Steele
Independent Director15.5yrsUS$202.08k0.016%
$ 2.2m
Douglas Skidmore
Independent Director16.5yrsUS$206.49k0.028%
$ 3.8m
Dirk Debbink
Independent Director7.92yrsUS$205.84k0.023%
$ 3.1m
David Osborn
Independent Director6.92yrsUS$216.82k0.027%
$ 3.6m
Jill Meyer
Independent Director1.17yrsUS$97.19k0.00028%
$ 38.0k
Linda Clement-Holmes
Independent Director10.67yrsUS$202.21k0.0076%
$ 1.0m

15.5yrs

Average Tenure

64yo

Average Age

Experienced Board: CINF's board of directors are seasoned and experienced ( 15.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: CINF insiders have sold more shares than they have bought in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Cincinnati Financial Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Cincinnati Financial Corporation
  • Ticker: CINF
  • Exchange: NasdaqGS
  • Founded: 1950
  • Industry: Property and Casualty Insurance
  • Sector: Insurance
  • Market Cap: US$13.558b
  • Shares outstanding: 160.85m
  • Website: https://www.cinfin.com

Number of Employees


Location

  • Cincinnati Financial Corporation
  • 6200 South Gilmore Road
  • Fairfield
  • Ohio
  • 45014-5141
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CINFNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDDec 1972
CCJDB (Deutsche Boerse AG)YesCommon StockDEEURDec 1972
0HYELSE (London Stock Exchange)YesCommon StockGBUSDDec 1972
CINF34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REP 0.5 COM USD2.00BRBRLMay 2019

Biography

Cincinnati Financial Corporation, together with its subsidiary, provides property casualty insurance products in the United States. The company operates in five segments: Commercial Lines Insurance, Person ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/22 00:32
End of Day Share Price2020/10/21 00:00
Earnings2020/06/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.