Q3 Net Income Falls 59% as Catastrophe Losses Push Combined Ratio to 90.9%
CINF sits 18% above its 52-week low of $150.
Summary
Net income dropped to $459 million, or $2.96 a share, from $1.122 billion, or $7.11, a year earlier, but almost all of the decline came from investment gains that collapsed to $16 million after-tax from $673 million. The number that matters is operating income: $443 million, or $2.86 a share, essentially flat with last year's $2.85 and a clean hold. Underwriting was the soft spot. The property casualty combined ratio rose to 90.9% from 88.2% as catastrophe losses added 7.0 points, and new business written premiums fell 12% to $315 million in a competitive market. Revenue was $3.05 billion. Nine-month operating income is still up 38% to $997 million and the 95.8% nine-month combined ratio sits inside management's 92%-98% target, so the quarter is a catastrophe-driven miss rather than a deterioration in the underlying book. Book value per share rose $3.07 to $105.42 since year-end, though the nine-month value creation ratio of 5.8% is well below last year's 13.8%.
At the time of this announcement, CINF was trading at $177.31 on NASDAQ in the Finance sector, with a market capitalization of approximately $27.2B. The 52-week trading range was $150.00 to $194.81. This news item was assessed with neutral market sentiment and an importance score of 8 out of 10. Source: PR Newswire.