Source : investing, 6/11/2024, Wednesday
American Financial Group, Inc. (NYSE: AFG) announced its financial results for the third quarter of 2024, reporting a net profit of $181 million, or $2.16 per share. These results are positive compared to $177 million, or $2.09 per share, recorded in the same quarter a year earlier. The company’s core net operating profit was $194 million, or $2.31 million. $208 per share down from $208 million.
or $2.45 per share, in the third quarter of 2023 .
The company’s annual return on equity (ROE) in the third quarter was 15.2%.
with a baseline operating return on equity of 16.2%. This performance reflects a decrease compared to the annual return on equity of 15.7% and the baseline operating return on equity of 18.3% in the third quarter of 2023.
EFG also announced a special dividend of $4.00 per share, payable on November 26, 2024.
to shareholders registered on November 15, 2024. This special dividend is in addition to the regular quarterly cash dividend of $0.80 per share paid on October 25, 2024.
The decrease in core net operating profit was mainly due to higher disaster losses, particularly from Hurricane Helen.
and a lower positive development in prior-year reserves in specialized property and accident insurance operations. This was partially offset by higher investment income.
Property and specialized casualty insurance operations reported an underwriting profit of $117 million for the quarter.
down from $143 million in the third quarter of 2023. Disaster losses for the quarter were $90 million.
mainly due to Hurricane Helen, compared to $56 million in the same period last year.
Gross and net written premiums for the third quarter increased by 19% and 14%, respectively.
compared to the third quarter of 2023.
driven by additional premiums from the acquisition of Crop Risk Services and a combination of new business opportunities.
increased exposures, and favorable renewal rates.
Book value per share was $56.10 as of September 30, 2024.
with book value per share excluding other comprehensive accumulated income (AOCI) at $57.71. Book value per share growth plus dividend was 8.7% for the quarter and 19.3% for the nine months ended September 30, 2024.
In other recent news, the American Financial Group (AFG) reported a strong performance in the second quarter.
with an annual base operating return on equity of 18.5%. The company’s specialized property and casualty insurance business showed strong underwriting margins.
contributing to a 15% year-on-year increase in net investment income for property and casualty. AFG’s consolidated ratio improved to 90.5%, reflecting an improvement of 1.4 points over the previous year. Despite strategic cuts in some high-risk areas, the company’s overall renewal rates have risen.
and it expects 7% growth in net written premiums for 2024.
AFG also announced an increase in ordinary dividends to shareholders. Insurance Holding Company stated that a dividend of $0.80 per share.
an increase of 12.7% over the annual dividend rate set in the fourth quarter of 2023.
will be distributed to shareholders registered on October 15, 2024.
Regarding analysts’ observations, Citi maintained its neutral stance towards AFG shares after downgrading the previous rating from buy to neutral. The company acknowledged AFG’s proactive actions in response to the challenging underwriting landscape and highlighted the company’s strategic growth in its mortgage portfolio. Citi revised its earnings per share forecast for AFG, showing a 2% increase for 2024 and 2025.
Finally, several Wall Street firms, including TD Securities, BNY Mellon, and Truist, have agreed to pay a total of more than $470 million in settlements with U.S. regulators due to violations of record-keeping rules by brokerages and investment advisors.
The recent financial results and strategic decisions of the American Financial Group (NYSE: AFG) align with several key metrics and insights from Investing Pro. The market capitalization of $10.71 billion and the price-to-profitability (P/E) ratio of 11.72 for the past twelve months through the second quarter of 2024 reflect the company’s strong performance.
One notable piece of advice from Investing Pro is that AFG “has kept paying dividends for 39 consecutive years.” This impressive record of dividend stability is underscored by the company’s recent announcement of a special dividend of $4.00 per share.
in addition to its regular quarterly dividend. Investors looking for income stability may find this particularly attractive, especially considering the current dividend yield. Adult 5.68%.
Another related tip from Investing Pro highlights that AFG “has an ideal Piotroski score of 9,” indicating strong financial health across different metrics. This aligns well with the company’s reported annual ROE of 15.2% for the third quarter and its ability to navigate challenges such as high disaster losses.
The company’s revenue growth of 7.59% over the past twelve months and quarterly growth of 4.2% in the second quarter of 2024 demonstrates its ability to expand its business.
which is reflected in the increase in gross and net written premiums reported for the third quarter.
