Zacks Investment Research Downgrades American Financial Group Inc. (AFG) to Sell
American Financial Group Inc. (NYSE:AFG) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research note issued to investors on Wednesday.
According to Zacks, “Exposure catastrophe loss is a risk to American Financial’s underwriting results as is a soft interest rate environment on investment. Nonetheless, the company is well poised to benefit from impressive inorganic growth deals and restructuring initiatives. An agreement to acquire the leftover shares of National Interstate shows prudence of investing in business that it knows best. Better industry fundamentals, with strong pricing and a higher renewal ratio, should drive overall growth. A strong balance sheet, low leverage cost, and disciplined capital management (raised dividend by 12% in Aug 2016) are positives. Notably, the Zacks Consensus Estimate dipped 0.2% for 2016, but the same inched up 0.3% for 2017, over the last 60 days. However, based on strong results through the first half the company expects earnings of $5.35 – $5.75 per share in 2016.”
Other research analysts also recently issued research reports about the company. Janney Montgomery Scott reiterated a “buy” rating on shares of American Financial Group in a report on Thursday, June 30th. Sandler O’Neill upgraded American Financial Group from a “hold” rating to a “buy” rating and increased their price objective for the company from $74.00 to $81.00 in a report on Friday, August 12th.
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Shares of American Financial Group (NYSE:AFG) traded up 0.74% on Wednesday, reaching $76.17. The company’s stock had a trading volume of 57,838 shares. American Financial Group has a 1-year low of $64.87 and a 1-year high of $76.93. The company has a market capitalization of $6.62 billion, a price-to-earnings ratio of 19.47 and a beta of 0.76. The stock has a 50-day moving average price of $74.92 and a 200-day moving average price of $72.43.
American Financial Group (NYSE:AFG) last released its quarterly earnings data on Tuesday, August 2nd. The company reported $1.28 EPS for the quarter, beating analysts’ consensus estimates of $1.27 by $0.01. American Financial Group had a return on equity of 9.74% and a net margin of 5.46%. The business had revenue of $1.58 billion for the quarter, compared to the consensus estimate of $1.06 billion. During the same quarter in the prior year, the business posted $1.28 EPS. The business’s revenue for the quarter was up 4.3% on a year-over-year basis. On average, equities research analysts forecast that American Financial Group will post $5.70 EPS for the current year.
The company also recently declared a quarterly dividend, which will be paid on Tuesday, October 25th. Investors of record on Friday, October 14th will be paid a dividend of $0.3125 per share. This represents a $1.25 dividend on an annualized basis and a yield of 1.65%. The ex-dividend date of this dividend is Wednesday, October 12th. This is an increase from American Financial Group’s previous quarterly dividend of $0.28. American Financial Group’s dividend payout ratio (DPR) is currently 28.57%.
In related news, Director Terry S. Jacobs sold 400 shares of the firm’s stock in a transaction that occurred on Friday, September 23rd. The stock was sold at an average price of $75.57, for a total transaction of $30,228.00. Following the transaction, the director now owns 2,000 shares in the company, valued at approximately $151,140. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, CEO Carl H. Lindner III sold 100,000 shares of the firm’s stock in a transaction that occurred on Monday, September 26th. The stock was sold at an average price of $75.14, for a total value of $7,514,000.00. The disclosure for this sale can be found here. Corporate insiders own 14.90% of the company’s stock.
Hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Geode Capital Management LLC boosted its stake in American Financial Group by 3.8% in the first quarter. Geode Capital Management LLC now owns 447,419 shares of the company’s stock worth $31,484,000 after buying an additional 16,235 shares during the last quarter. Goldman Sachs Group Inc. boosted its stake in American Financial Group by 21.2% in the first quarter. Goldman Sachs Group Inc. now owns 571,154 shares of the company’s stock worth $40,192,000 after buying an additional 99,834 shares during the last quarter. Rafferty Asset Management LLC boosted its stake in American Financial Group by 49.0% in the first quarter. Rafferty Asset Management LLC now owns 9,103 shares of the company’s stock worth $641,000 after buying an additional 2,995 shares during the last quarter. State Street Corp boosted its stake in American Financial Group by 1.4% in the first quarter. State Street Corp now owns 2,189,350 shares of the company’s stock worth $154,060,000 after buying an additional 30,672 shares during the last quarter. Finally, Kempen Capital Management N.V. boosted its stake in American Financial Group by 114.6% in the first quarter. Kempen Capital Management N.V. now owns 5,130 shares of the company’s stock worth $361,000 after buying an additional 2,740 shares during the last quarter. Hedge funds and other institutional investors own 59.90% of the company’s stock.
About American Financial Group
American Financial Group, Inc (AFG) is a holding company engaged primarily in property and casualty insurance businesses. The Company, through Great American Insurance Group, focuses on commercial products for businesses, and is engaged in the sale of fixed and fixed-indexed annuities in the retail, financial institutions and education markets.
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